Cost Accounting

Dynamic Industrial purchasing manager has a friend who owns the company (COMP Inc) that produces some of the components that go into the X370A. COMP Inc. has been losing money in recent years. To save money, COMP Inc. has begun using a lower quality component and selling their components at a lower price to the public. However, the Dynamic Industrials purchasing manager has not renegotiated the contract and continues to purchase the components at an above-market rate to help the friend. Is the purchasing managers behavior in this situation ethical? Why or why not?

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