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Business, 04.07.2020 18:01 mrstealyogirl40

An electronics firm is currently manufacturing an item that has a variable cost of $ 0.45 per unit and a selling price of $ 0.95 per unit. Fixed costs are $16,000. Current volume is 35,000 units. The firm can substantially improve the product quality by adding a new piece of equipment at an additional fixed cost of $6,400. Variable cost would increase to $ 0.60 and the selling price would be revised to $ 1.15 with the expectation that the volume would be 45,000 units as a result of a​ higher-quality product. Requried:Should the company buy the new equipment?

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