Asked by
Brianda Chavez
on Nov 13, 2024
Verified
The opportunity cost of an alternate course of action that is relevant to a make-or-buy decision is
A) subtracted from the "Make" costs.
B) added to the "Make" costs.
C) added to the "Buy" costs.
D) None of these answer choices are correct.
Opportunity Cost
The cost of forgoing the next best alternative when making a decision, representing the benefits one misses out on when choosing one option over another.
Make-Or-Buy Decision
The decision-making process whereby a company evaluates the costs and benefits of manufacturing a product in-house versus purchasing it from an external supplier.
- Assess the opportunity costs related to deliberations on manufacturing in-house versus outsourcing.
Verified Answer
KS
Learning Objectives
- Assess the opportunity costs related to deliberations on manufacturing in-house versus outsourcing.
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