A manager invests 20,000 in equipment that would help the company reduce it's per unit costs from 15 to 12 . He expects the equipment to be in use for the next seven years. After two years, he realizes that if he outsourced the production, the unit cost would be 7 instead. At this point what should the senior manager do?
a. Charge the manager for the next five years of depreciation
b. Write off the equipment as sunk cost and allow for outsourcing since it is cheaper
c. Not allow for outsourcing since the equipment is good for another five years
d. None of the above
Question 2
A firm that acquires a substitute product can try to reduce inter-product cannibalization by
a. Doing nothing
b. Repositioning its product or the substitute so that they do not directly compete with each other
c. Pricing each product at the same level
d. Lowering the prices on both the products
Increasing Costs of Natural Disasters
To reduce stress on your client’s neck when the head is turned, put a towel under the shoulder and ...
How to evaluate angles using sine, special triangles, the unit circle (Part 1)
Pharmaceutical Company Representatives
Jia's Fashions recently paid a $2 annual dividend. The company is projecting that its ...
Sabrina's Fabric Land bought $5,000 of equipment at the beginning of 2015. Amortization ...