Question: Question 4. Question 4. A firm's manager must decide whether to make or buy a certain item used in the production of vending machines. Making

Question 4.

Question 4. Question 4. A firm's manager must

Question 4. A firm's manager must decide whether to make or buy a certain item used in the production of vending machines. Making the item would involve annual lease costs of $150,000. Cost and volume estimates are as follows: Make Buy Annual fixed cost $ 150.000 None Variable cost/unit $ 60 $ 80 Annual volume (units) 12,000 12,000 a. Given these numbers, should the firm buy or make this item? b. There is a possibility that volume could change in the future. At what volume would the manager be indifferent between making and buying

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