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Altec Company Has Relevant Costs of $40 Per Unit to Manufacture

Question 166

Multiple Choice

Altec Company has relevant costs of $40 per unit to manufacture 1,000 units of Part A. A current supplier offers to make Part A for $35 per unit. If capacity is constrained, the opportunity cost of buying Part A from the supplier is:


A) 0
B) $5,000
C) $35,000
D) indeterminable

Correct Answer:

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