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FiberSystems manufactures an optical switch that it uses in its final product. FiberSystems incurred the following manufacturing costs when it produced 69,000 units last year:

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FiberSystems manufactures an optical switch that it uses in its final product. FiberSystems incurred the following manufacturing costs when it produced 69,000 units last year: (Click the icon to view the manufacturing costs.) FiberSystems does not yet know how many switches it will need this year; however, another company has offered to sell FiberSystems the switch for $8.50 per unit. If FiberSystems buys the switch from the outside supplier, the manufacturing facilities that will be idle cannot be used for any other purpose, yet none of the fixed costs are avoidable. Using the basic formula you determined above, solve for the outsourcing cost at which FiberSystems would be indifferent between outsourcing and making the switches. FiberSystems would be indifferent between outsourcing and making the switches if the outsourcing cost was $ per switch. Therefore, FiberSystems will only be willing to outsource if the outsourcing cost is

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