In a make-or-buy decision,if plant facilities will remain idle when the decision is made to outsource a part used in a product,then the opportunity cost of the plant facilities is zero.Assume there are no alternative uses of the plant facilities available.

Question

Quizplus · Accepted Answer

When there are no alternative uses of the plant facilities available, the opportunity cost of keeping them idle is zero. Therefore, if the decision is made to outsource a part used in a product, the opportunity cost of the idle plant facilities is zero.

In a Make-Or-Buy Decision,if Plant Facilities Will Remain Idle When