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What do you think about the hybrid approach? Is it worth paying the local supplier extra to use it as part of a hybrid strategy?
What do you think about the hybrid approach? Is it worth paying the local supplier extra to use it as part of a hybrid strategy? For the hybrid approach, assume that management will order a base load of units from the Chinese supplier for each of the two periods, making up any shortfall in each period at the local supplier. Evaluate the NPV of expected profits for the hybrid option assuming a discount factor of per period.
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