Forrester company is considering buying new equipment that would increase monthly fixed costs from $405,000 to $396,000 and would decrease the current variable costs of $70 by $10 per unit. the selling price of $120 is not expected to change. forrester's current break-even sales are $972,000 and current break-even units are 8,100. if forrester purchases this new equipment, the revised break-even point in dollars would be: a. 30%. b. 60%. c. 40%. d. 10%. e. 70%.

Adrawback of short-term contracting as an alternative to making a component in-house is thata. it is the most-integrated alternative to performing an activity so the principal company has no control over the agent. b. the supplying firm has no incentive to make any transaction-specific investments to increase performance or quality. c. it fails to allow a long planning period that individual market transactions provide. d. the buying firm cannot demand lower prices due to the lack of a competitive bidding process.