Make the optical switch because the Tixed cost per unit make the switch is less than the variable cost per unit to buy the switch. Requirement 2. Now, assume that Tech Systems can avoid $85,000 of fixed costs a year by outsourcing production. In addition, because sales are increasing, Tech Systems needs 88,000 switches a year rather than 80,000. What should Tech Systems do now? Complete an incremental analysis to calculate relevant costs. Tech Systems Outsourcing Decision Make Buy switches 13.8 88000 switches 11.4 88000 Variable cost per unit Units needed Total variable costs 1003200 1214400 Fixed costs 465000 380000 Total relevant costs 1468200 1594400 Decision: Make the optical switch because the total relevant costs to make the switches are less than the total relevant costs to buy the switches. Requirement 3. Given the last scenario, what is the most Tech Systems would be willing to pay to outsource the switches? (Round your answers to the nearest cent.) Tech Systems would be indifferent between outsourcing and making the switches if the outsourcing cost was $ 12.4 per switch. Therefore, Tech Systems will only be willing to outsource if the outsourcing cost is less than $12.4 per switch. Enter any number in the edit fields and then continue to the next question. Make the optical switch because the Tixed cost per unit make the switch is less than the variable cost per unit to buy the switch. Requirement 2. Now, assume that Tech Systems can avoid $85,000 of fixed costs a year by outsourcing production. In addition, because sales are increasing, Tech Systems needs 88,000 switches a year rather than 80,000. What should Tech Systems do now? Complete an incremental analysis to calculate relevant costs. Tech Systems Outsourcing Decision Make Buy switches 13.8 88000 switches 11.4 88000 Variable cost per unit Units needed Total variable costs 1003200 1214400 Fixed costs 465000 380000 Total relevant costs 1468200 1594400 Decision: Make the optical switch because the total relevant costs to make the switches are less than the total relevant costs to buy the switches. Requirement 3. Given the last scenario, what is the most Tech Systems would be willing to pay to outsource the switches? (Round your answers to the nearest cent.) Tech Systems would be indifferent between outsourcing and making the switches if the outsourcing cost was $ 12.4 per switch. Therefore, Tech Systems will only be willing to outsource if the outsourcing cost is less than $12.4 per switch. Enter any number in the edit fields and then continue to the next