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27-49. Elkhart, a division of Indiana Enterprises, currently makes 100,000 units of a product that...

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27-49. Elkhart, a division of Indiana Enterprises, currently makes 100,000 units of a product that has created a number of manufacturing problems. Elkhart's costs follow Manufacturing costs: Variable $540,000 180,000 Allocated corporate administrative cost60,000 Fixed IfElkhart were to discontinue production, fixed manufacturing costs would be reduced by 70%. The relevant cost of deciding whether the division should purchase the product from an outside supplier is: A. $540,000 B. $594,000 C. $666,000 D. $720,000 E. $726,000 28-33. If the volume sold reacts strongly to changes in price, demand: Has no elasticity Has no elasticity A. B. Is elastic C. Is inelastic D. Is unrealistic Has negative elasticity E

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