Question: II. Make or Buy Currently make component that is a part of a product Cost to make component (per unit): $22 ($16 variable, $6 fixed)

II. Make or Buy Currently make component that is a part of a product Cost to make component (per unit): $22 ($16 variable, $6 fixed) Have an offer from a company to make the component for us for $19 per unit We produce 18,000 units per year If we purchase component, variable costs are eliminated, but none of the fixed costs are eliminated Should we make or buy? (Show your work)

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