Assignment:
A product is currently made in a product-focused shop, where fixed costs are $10,000 per month and variable cost is $60 per unit. The firm sells the product for $220 per unit.
a. Determine the profit and the breakeven quantity per year?
b. If the option of outsourcing is available where the cost per unit is $65 and the quantity demanded per year is 8000 units, which option is better in your opinion? Justify your answer.