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Parker Inc. has the following costs when producing 1 0 0 , 0 0 0 units: Variable costs $ 6 0 0 , 0 0

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Parker Inc. has the following costs when producing 100,000 units:
Variable costs
$600,000
Fixed costs
900,000
An outside supplier is interested in producing the item for Parker. If the item is produced outside, Parker could use the released production facilities to make another item that would generate $150,000 of net income. At what unit price would Parker accept the outside supplier's offer if Parker wanted to increase net income by $120,000?
a. $8.70
b. $7.50
c. $5.70
d. $6.30
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