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The Beta Firm has an estimated cost formula for processing rebates of $4,000 per month plus $2.20 per rebate. This is not their core business
The Beta Firm has an estimated cost formula for processing rebates of $4,000 per month plus $2.20 per rebate. This is not their core business and the $4,000 per month would be eliminated if they do not process rebates internally. Beta estimates it will have 60,000 rebates in 2020. An outside firm, The Gamma Group, has offered to process Betas refunds on a purely variable basis for 2020. What price per rebate could Gamma Group charge such that Beta Firm indifferent between continuing to process the rebates internally or externally?
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