Firm XX currently produces a part, Z, that goes into the production of one of the firms major products. The firm is now trying to decide whether they should continue to make or buy part Z. The accounting department has determined that of the $150,000 of costs associated with making the part, $100,000 could be eliminated (avoided). The cost of buying part Z from an outside supplier is $80,000. How much better off or worse off would Firm XX be if they buy part Z.

		$20,000 better off by buying the part.
		$70,000 worse off by buying the part.
		$20,000 worse off by buying the part.
		$70,000 better off by buying the part.