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Troy Engines, Limited, manufactures a varlety of engines for use in heavy equipment. The company has always produced all of the necessary parts for its

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Troy Engines, Limited, manufactures a varlety of engines for use in heavy equipment. The company has always produced all of the necessary parts for its engines, including all of the carburetors. An outside supplier has offered to sell one type of carburetor to Troy Engines, Limited for a cost of $34 per unit. To evaluate this offer. Troy Engines, Limited, has gathered the following information relat to its own cost of producing the carburetor internally: Required: 1. Assuming the company has no alternative use for the facilities that are now being used to produce the carburetors, what would be the financial advantage (disodvantage) of burying 21,000 carburetors from the outside supplier? 2 Should the outside supplier's offer be accepted? 3 Suppose thatil the cabbuctlors were purchased, Troy Engines, Limited could use the freed capacity to launch a new product. The segment matgin of the rew product would be $210.000 per year: Given this new assumption whot would be the financial advanatage lolsadvantagel of buyng 21.000 carburetors trom the outside suppler? 4. Given the neviassumption in requitement 3 , should the outside supplien s offer be accepted

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