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Part 1
Suppose that a manufacturer can produce a part for $8.00 with a fixed cost of $5, 000. Alternately, the manufacturer could contract with a supplier in Asia to purchase the part at a cost of $11.00, which includes transportation.
a. If the anticipated production volume is 1 ,300 units, compute the total cost of manufacturing and the total cost of outsourcing.
b. What is the best decision?
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Part 1
a. The total cost of manufacturing is $
enter your response here.
(Simplify your answer.)