A Manufacturing Company Needs to Know Whether to Make In-House

Multiple Choice

A manufacturing company needs to know whether to make in-house or buy a roller gear assembly for its production of a new fax machine. The company expects to produce 9,000 units per year. The following estimates have been made:
$\begin{array}{|l|c|c|}\hline & \text { Make } & \text { Buy } \\\hline \text { Fixed cost per year } & \$ 8,000 & \$ 0 \\\hline \text { Variable cost per part } & \$ 5.45 & \$ 6.93 \\\hline\end{array}$
-The volume they are indifferent regarding the decision to make or buy is _____ units.

A) less than or equal to 2,000
B) more than 2,000 but less than or equal to 4,000
C) more than 4,000 but less than or equal to 6,000
D) more than 6,000 but less than or equal to 8,000