Question: make or buy blunt ltd produces a component for inclusion...
(Make or Buy) Blunt Ltd produces a component for inclusion in its pocket calculator. The full absorption costs of production, based on an output level of 50,000 units are:
Variable overheads Fixed overheads Total cost
50p 25p 35p 70p
A new supplier of electronic components is currently offering to supply an identical part for £1.55.
Should Blunt make or buy the component?