Harlose Suits faced a lot of complaints from customers when its recent batch of goods was dispatched. The employees at Harlose Suits, hence, had to rework on the returned items, and in some cases, the company had to even replace the faulty goods. In this case, the costs incurred by Harlose Suits are an example of . a. prevention costs b. internal failure costs c. external failure costs d. appraisal costs

You are the manager of a large crude-oil refinery. as part of the refining process, a certain heat exchanger (operated at high temperatures and with abrasive material flowing through it) must be replaced every year. the replacement and downtime cost in the first year is $165 comma 000. this cost is expected to increase due to inflation at a rate of 7% per year for six years (i.e. until the eoy 7), at which time this particular heat exchanger will no longer be needed. if the company's cost of capital is 15% per year, how much could you afford to spend for a higher quality heat exchanger so that these annual replacement and downtime costs could be eliminated?