Question: E 3 Q 2 0 through outsourcing, so it will just remain idle. What is the maximum Hoffman will pay per Model A 2 0

E3 Q20 through outsourcing, so it will just remain idle. What

E3 Q20 through outsourcing, so it will just remain idle.
What is the maximum Hoffman will pay per Model A20 box to outsource production of this box?
Begin by identifying the basic formula that is used to determine the indifferent outsourcing cost per unit.
Using the basic formula you determined above solve for the indifferent outsourcing cost per unit.
The maximum Hoffman will pay to outsource production of its A20 boxes is
Hoffman would be indifferent between outsourcing and making the A20 boxes if the outsourcing price was
per A20 box. Therefore, Hoffman will only be willing to pay
] per A20 box if outsourcing.
is the maximum Hoffman will pay per Model A20 box to outsource

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