Decision Making and Relevant Costs at Google

Values:

• Internal Production Cost: $30 per unit
• Outsourcing Cost: $25 per unit
• Quality Control Cost: $5 per unit

Requirements:

1. Perform a make-or-buy analysis to determine the most cost-effective option for Google.
2. Calculate the total relevant costs for both options.
3. Recommend whether Google should produce internally or outsource based on cost analysis.