33 34 Part B 35 The firm is considering whether to make or buy component MD4 36 37 Quantity required 7.800 units 38 Purchase price per unit E 6.70 39 Marginal production cost per unit E 4.80 40 41 The component would have to be made on a machine which is currently working at 42 full capacity. If the firm decides to make the component, sales of a finished 43 product will be reduced. 44 Model CEO 45 sales reduced by 580 units 46 marginal cost E 65 47 Selling price E 90 48 Required: 49 Recommend whether the firm should make or buy the component, referring to any 50 qualitative factors which may affect the decision. 51 52 53 54 55