Problem 3 Eagle Bags produces messenger bags and backpacks in California. Eagle's design team created a new bag that includes a built-in power charge. The power charge can be used to recharge most smart phones and tablet computers and is ideal for people who are constantly on the move. The retail price of the new bag will be $229. The product is expected to be very popular. The company has identified the following options to manufacture the new bags: Option A: Eagle Bags outsources production of the new product to a third party at a cost of $180 per unit (including labor and materials). There is negligible fixed cost if the bag is produced by a third party Option B: Eagle Bags makes the product in house, at S120 per unit (including labor and materials). The company has to acquire additional sewing machines at a cost of $60,000 to produce the new product at its existing facility. Option C. Eagle Bags refurbishes one of its storage facilities with entirely new technology. The company purchases numerically-controlled machines to manufacture the bags at $70 per unit (including labor and materials). This option has a fixed cost of S220,000. a) Determine the range of production volume which makes Option A the lowest-cost option. b) Determine the range of production volume which makes Option B the lowest-cost option. e) Determine the range of production volume which makes Option the lowest-cost option