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To produce an item in-house, equipment costing $250,000 must be purchased. It will have a life of 4 years and an annual cost of $80,000;
To produce an item in-house, equipment costing $250,000 must be purchased. It will have a life of 4 years and an annual cost of $80,000; each unit will cost $40 to manufacture. Buying the item externally will cost $100 per unit. At i=12% determine the breakeven production number. |
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