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A company can produce 100 units of a component part with total variable cost of $ 75,000 and fixed cost of $ 22,000. These component

A company can produce 100 units of a component part with total variable cost of $ 75,000 and fixed cost of $ 22,000. These component units can be purchased externally at price of $8 per unit. Fixed costs are not avoidable. By what amount will its total costs change if they purchase externally ?

a
an increase of $17,000
b
a decrease of $17,000
c
an increase of $5,000
d
a decrease of $5,000

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