BWM Motors currently purchases batteries from an outside supplier, which are used in the motorcycles that they manufacture. BWM pays $78 for each battery and uses 1,000 batteries per year. BWM's management team is considering manufacturing the batteries internally and has estimated
The per unit battery cost to be as follows:
BWM has idle capacity and can manufacture the batteries without affecting the manufacture of their Motorcycles. Should BWM manufacture the batteries?

Question

BWM Motors currently purchases batteries from an outside supplier, which are used in the motorcycles that they manufacture. BWM pays $78 for each battery and uses 1,000 batteries per year. BWM's management team is considering manufacturing the batteries internally and has estimated
The per unit battery cost to be as follows:
 BWM has idle capacity and can manufacture the batteries without affecting the manufacture of their Motorcycles. Should BWM manufacture the batteries?

Quizplus · Accepted Answer

The Answer of BWM Motors currently purchases batteries from an outside supplier, which are used in the motorcycles that they manufacture. BWM pays $78 for each battery and uses 1,000 batteries per year. BWM's management team is considering manufacturing the batteries internally and has estimated
The per unit battery cost to be as follows:
 BWM has idle capacity and can manufacture the batteries without affecting the manufacture of their Motorcycles. Should BWM manufacture the batteries?

BWM Motors Currently Purchases Batteries from an Outside Supplier, Which