PLEASE EXPLAIN THIS ALL IN THEORY FOR PRESENTATION SPEAKING

To ascertain if producing or purchasing is feasible from a financial standpoint, we must compare the whole cost of producing 18,000 devices internally to the price of obtaining 18,000 units from the issuer. It should be common for the issuer to value its $400 per unit The cost of internally manufacturing 18,000 devices may cover the $150,000 association fee and the price for abnormalities. If the deformity price is 10%, we must assume 1,800 defective products. The total worth of the defects may be $1800 125 = $220,000, with each defect's value being equal to 125dollars

Thus, distributing 18,000 units internally might be valued at the: Purchasing 18,000 devices from the company might cost: $5,766.000 = ($18,000-$300) + $150.000 + $216,000. We can see that internally returning the 18,000 items would be more financially viable when we compare the two pricing because it would save us $582,000 in total. Total charge = $18,000 x $400 = $7,200,000.

2.If we produce 18,000 units as opposed to 10,000, the larger run may lead to unique production circumstances or cycles, which may change the likelihood of flaws. We can't predict whether the likelihood of malformations will increase or decrease without further information about the advent cycle and the causes of deserts.