Grand Limited currently produces a component of a product with the following per unit production costs:

Direct materials	$18.93
Direct labour	32.35
Overhead	20.74
Total production costs	$72.02

Grand Ltd. currently manufactures these components in-house, averaging production of 29196 units each year. A supplier has approach the company offering to supply 29196 units each year at a cost of $53.12 each.

60% of the overhead is fixed and if Grand Ltd. purchases the components, then 1/3 of the fixed overhead costs would be avoidable.

What is the maximum price that Grand should pay per unit for the component?

Select one:

a. $72.02

b. $63.72

c. $58.19

d. $59.58