A company has the option of purchasing an item or making it in house. Annual demand is 3000 units/year. Holding cost is assessed at 10% of the cost of either buying or making one unit. If the item is purchased, the company will be charged $25/unit plus a cost of $4/order. If the company makes the item, it has a production capacity of 8000 unit/year. It costs $50 to setup a production run and $23 to make each unit. Determine whether the company should purchase or make the item.