There are two alternatives for a company to compose the ads. In the first alternative, the company will have to purchase computers, printers, and the other peripherals at a cost of $10000.The equipment will have a usefull life of 5 years, after which it will be sold for $2000.The employee who creates the ads will be paid $45000 per year.In addition each add will have an average cost of$80 to prepare for delivery to the printer.Alternatively the company can outsource ad development at a fee of $200 per ad regardless of the quantity.The current interest rate is 10% per year.What is the breakeven amount, and which alternative is economically better?
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