Each unit of a product requires eight components. The average number of components is 8.25 due to component failure. Purchasing higher quality components can reduce the average number of components to four per unit. The cost per component is $500. What is the reduction in failure costs per unit due to purchasing higher quality components?
A) $43.75
B) $125.00
C) $175.00
D) $350.00

Question

Quizplus · Accepted Answer

The Answer of Each unit of a product requires eight components. The average number of components is 8.25 due to component failure. Purchasing higher quality components can reduce the average number of components to four per unit. The cost per component is $500. What is the reduction in failure costs per unit due to purchasing higher quality components?
A) $43.75
B) $125.00
C) $175.00
D) $350.00

Each Unit of a Product Requires Eight Components