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Plz solve it within 30-40 mins with full explanation I'll give you multiple upvote.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Plz solve it within 30-40 mins with full explanation I'll give you multiple upvote.
Nevada Pen Company manufactures a full line of premium writing instruments. It has 12 different styles and within each style, it offers ball point pens, fountain pens, mechanical pencils, and a roller ball pen. Most models also come in three finishes- gold, silver, and black matte. Nevada Pen's Bangkok, Thailand, plant manufactures four of the styles. The plant is currently producing the gold clip for the top of one of its pen styles, no. 872. Current production is 1,500 gold no. 872 pens each month at an average cost of 90 baht per gold clip. (One U. S. dollar currently buys 32.25 baht.) A Chinese manufacturer has offered to produce the same gold clip for 50 baht. This manufacturer will sell Nevada Pen 600 clips per month. If it accepts the Chinese offer and cuts the production of the clips from 1,500 to 900, Nevada Pen estimates that the cost of each clip 118 baht per gold clip. continues to produce will rise from 90 baht to Required: At what price would Nevada Pen be indifferent to outsourcing the clips? (That is, at what price would the difference be zero?) C.
Transcribed Image Text:Nevada Pen Company manufactures a full line of premium writing instruments. It has 12 different styles and within each style, it offers ball point pens, fountain pens, mechanical pencils, and a roller ball pen. Most models also come in three finishes- gold, silver, and black matte. Nevada Pen's Bangkok, Thailand, plant manufactures four of the styles. The plant is currently producing the gold clip for the top of one of its pen styles, no. 872. Current production is 1,500 gold no. 872 pens each month at an average cost of 90 baht per gold clip. (One U. S. dollar currently buys 32.25 baht.) A Chinese manufacturer has offered to produce the same gold clip for 50 baht. This manufacturer will sell Nevada Pen 600 clips per month. If it accepts the Chinese offer and cuts the production of the clips from 1,500 to 900, Nevada Pen estimates that the cost of each clip 118 baht per gold clip. continues to produce will rise from 90 baht to Required: At what price would Nevada Pen be indifferent to outsourcing the clips? (That is, at what price would the difference be zero?) C.
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