7.1 Borges Machine Shop, Inc., has a 1-year contract for the production of 200,000 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 machines (DM). The cost data follow: General Purpose Equipment(GPE) Dedicated Machine(DM) Flexible Manufacturing System(FMS) 200.000 Annual Contracted units 200.000 200,000 Annual fixed cost $100.000 $200,000 $14 $500,000 $13 Per unit variable cost $15 7.2 Using the data in Problem 7.1 determine the most economical volume for each process