(solution) Suppose a manufacturer has identified the following options for obtaining a machined part; It can…

(solution) Suppose a manufacturer has identified the following options for obtaining a machined part; It can…

Suppose a manufacturer has identified the following options for obtaining a machined part; It can buy the part at $200 per unit (including materials); it can make the part on a numerically controlledsemiautomatic lathe at $75 per unit (including materials); or it can make the part on amachining centerat $15 per unit (including materials), there is negligible fixed cost if the item is purchased; asemiautomatic lathe costs $80,000; and amachining center costs $200,000. (assume that we sell the part at $300/unit.)