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Junior Company Currently Buys 30,000 Units of a Part Used

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Junior Company currently buys 30,000 units of a part used to manufacture its product at $40 per unit. Recently the supplier informed Junior Company that a 20% increase will take effect next year. Junior has some additional space and could produce the units for the following per-unit costs (based on 30,000 units):
Junior Company currently buys 30,000 units of a part used to manufacture its product at $40 per unit. Recently the supplier informed Junior Company that a 20% increase will take effect next year. Junior has some additional space and could produce the units for the following per-unit costs (based on 30,000 units):     If the units are purchased from the supplier, $200,000 of fixed costs will continue to be incurred. In addition, the plant can be rented out for $20,000 per year if the parts are purchased externally. Required: Should Junior Company buy the part externally or make it internally?
If the units are purchased from the supplier, $200,000 of fixed costs will continue to be incurred. In addition, the plant can be rented out for $20,000 per year if the parts are purchased externally.
Required: Should Junior Company buy the part externally or make it internally?

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Definitions:

Silent Spring

A landmark environmental science book published in 1962 by Rachel Carson, credited with advancing the global environmental movement.

Indiscriminate Use

Utilizing resources, tools, or practices without regard for consequences, often leading to wastefulness or harm.

Pesticides

Chemicals used to kill or control pests that affect crops and human health.

Environmental Movement

A social and political movement focused on addressing environmental issues and promoting sustainable practices.

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