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A firm is considering buying 30,000 units of a component used in one of its products instead of making it. The incremental costs of making the product is $10 per unit and it can buy a component of equal quality for $12 per unit. If the firm buys the unit, then it can rent the freed up factory space for $50,000. Which of the following is true? a. The firm should not buy the component because it will be $10,000 worse off. b. The firm should buy the component because it will be $50,000 better off. c. The firm should buy the component because it will be $10,000 better off. d. The firm should not buy the component because it will be $60,000 worse off.
Sagot :
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