A company regularly sells 50,000 sump pumps at an average price of $300. The average cost of
Question:
A company regularly sells 50,000 sump pumps at an average price of $300. The average cost of producing these pumps is $230, which includes both fixed and variable cost elements. Under what circumstances might the company accept a special order for 5,000 pumps at $225 per pump?
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The first consideration is whether there is idle capacity Thus if some regular sales of sum...View the full answer
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