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Luna Plc. needs to hire an external annual insurance service for one of its production departments. The insurance company offers two potential contract options:

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Luna Plc. needs to hire an external annual insurance service for one of its production departments. The insurance company offers two potential contract options: Insurance agreement 1: one unique annual payment of 12,000. Insurance agreement 2: monthly payment of 1,920. Insurance agreement 3: monthly payment of 800 and one annual payment of 52 per machine. Considering the existence of 300 machines in the department and that the annual budget for this insurance agreement equals 10,000, which of the following statements is true? O a. Luna Plc. should accept insurance agreement 2. O b. Luna Plc. should accept insurance agreement 2 or 3. O c. Luna Plc. cannot accept any of the options. O d. None of the answers is true. 1

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