UTB Sdn Bhd purchases mild steel pipes at $ 6,000 per piece. Historical data predicts that out of 20000 pipes used, 300

[answerhappygod]

UTB Sdn Bhd purchases mild steel pipes at $ 6,000 per piece.
Historical data predicts that
out of 20000 pipes used, 300 pipes will fail by corrosion during
the first year. Total cost of
replacement for each failed pipe is approximately $ 40,000,
including the cost of
environmental clean-up, loss of product, downtime, repair, and
replacement. Purchasing
stainless steel pipes would prevent failure by corrosion. But they
come with a cost of $ 6,750
per piece. Based on these, explain whether the engineers at UTB Sdn
Bhd should propose
the purchase of stainless steel instead of the existing mild steel
pipes.