content area Part 1 Borges Machine Shop, Inc., has a 1-year contract for the production of 75,000 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 data follow: General-Purpose Equipment (GPE) Flexible Manufacturing System (FMS) Dedicated Machine (DM) Annual contracted units 75,000 75,000 75,000 Annual fixed cost $150,000 $250,000 $480,000 Per unit variable cost $16.00 $14.75 $13.50 Part 2 Based on the total cost, the process that is best suited for the current contracted volume is GPE . Part 3 Suppose the contracted volume changes to 275,000 gear housings. Based on the total cost, the process that is best suited for the new volume is GPE FMS DM