Answer:
correct option is d. $225
Step-by-step explanation:
given data
product requires = 5 component
average number of components = 5.50
reduce average number of components = 5 per unit
cost per component = $450
solution
we get here reduction in failure costs per unit due to purchasing that is express as
reduction in failure costs per unit due to purchasing = ( average number of components - product requires ) × cost per component .......................1
put here value and we get
reduction in failure costs per unit due to purchasing = ( 5.50 - 5 ) × $450
reduction in failure costs per unit due to purchasing = $225
so correct option is d. $225