Question: Answer fully thanks LO 6-3 Problem 6-26B Effects of the level of production on an outsourcing decision One of Riku Company's major products is a

Answer fully thanks
 Answer fully thanks LO 6-3 Problem 6-26B Effects of the level
of production on an outsourcing decision One of Riku Company's major products

LO 6-3 Problem 6-26B Effects of the level of production on an outsourcing decision One of Riku Company's major products is a fuel additive designed to improve fuel efficiency and keep engines clean. Riku, a petrochemical firm, makes and sells 100,000 units of the fuel additive per year. Its management is evaluating the possibility of having an outside supplier manufacture the prod- uct for Riku for $3.20 each. Riku would continue to sell and distribute the fuel additive under its own brand name for either alternative. Riku's accountant constructed the following profitability analysis

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