Question
Crane Company is unsure of whether to sell its product assembled or unassembled. The unit cost of the unassembled product is $24 and Crane would
Crane Company is unsure of whether to sell its product assembled or unassembled. The unit cost of the unassembled product is $24 and Crane would sell it for $42. The cost to assemble the product is estimated at $6 per unit and the company believes the market would support a price of $43 on the assembled unit. What decision should Crane make?
A. Sell before assembly, the company will be better off by $5 per unit.
B. Sell before assembly, the company will be better off by $1 per unit.
C. Process further, the company will be better off by $12 per unit.
D. Process further, the company will be better off by $19 per unit.
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