Borges Machine? Shop, Inc., has a? 1-year contract for the production of 225,000 gear housings for a new? off-road vehicle. Owner Luis Borges hopes the contract will be extended and the volume increased next year. Borges has developed costs for three alternatives. They are? general-purpose equipment? (GPE), flexible manufacturing system? (FMS), and? expensive, but? efficient, dedicated machine? (DM). The cost data? follow:
General-Purpose Equipment? (GPE) Flexible Manufacturing System? (FMS) Dedicated Machine? (DM)
Annual contracted units $225,000 $225,000 $225,000
Annual fixed costs $125,000 $200,000 $480,000
Per unit variable cost $16 $14 $13
1. The option GPE is best when the contracted volume is below ____ units ?(enter your response as a whole? number).
2. The option FMS is best when the contracted volme is between ____ and ____ units (enter your response as a whole number).
3. The option DM is best when the contracted volume is over ________ units (enter your response as a whole number).