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Find and negotiate contracts

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Spacely Sprockets, Inc., usually pays $1,000 for a million flanges, which it uses as inputs in the manufacture of sprockets. It also spends an average of $20 per million flanges on finding manufacturers and negotiating contracts. Spacely is capable of making its own flanges at a cost of $980 per million. Given these costs, Spacely should stop paying the additional $20 to find and negotiate contracts and just buy the flanges outright for $1,000 per million

A. True

B. False

Reference no: EM131088483

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