Question: 6) Problem 7.2 Borges Machine Shop, Inc., has a 1-year contract for the production of 250,000 gear housings for a new off-road vehicle. Owner Luis

6) Problem 7.2 Borges Machine Shop, Inc., has a
6) Problem 7.2 Borges Machine Shop, Inc., has a 1-year contract for the production of 250,000 gear housings for a new off-road vehicle. Owner Luis Borges hopes the contract will be extended and the volume increased next year, Borges has developed costs for three alternatives. They are general-purpose equipment (GPE), flexible manufacturing system (FMS), and expensive, but efficient, dedicated machine (DM). The cost dato follow Annual contracted units Annual fixed cost Per unit variable cost General Purpose Equipment (GPE) 250,000 $100,000 $16.00 Flexible Manufacturing System (FMS) 250,000 $200,000 $14.00 Dedicated Machine (DM) 250,000 $525,000 $13.00 The option GPE is best when the contracted volume is below units conter your response as a whole number)

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