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Nowlin & Rudder Is a Manufacturer of Sports Equipment

Question 74

Multiple Choice

Nowlin & Rudder is a manufacturer of sports equipment.It has been approached by a large European retailer about the possibility of producing a special order of tennis rackets.Under which of the following conditions should Nowlin & Rudder accept this offer?


A) The firm has the capacity to produce the special order.
B) The firm has the capacity to produce the special order and the special-order price exceeds the fixed cost related to of the special order.
C) The firm has the capacity to produce the special order and the special-order price exceeds the total variable cost of the special order.
D) The firm has the capacity to produce the special order and the special-order price exceeds the incremental cost of the special order.

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