Michigan Espresso Industries (ME) produces espresso machines and replacement parts for them. ME is considering outsourcing the production of one type of part, which has the following per-unit costs: If this part is outsourced, ME will not reduce its manufacturing capacity and thus not reduce existing fixed manufacturing costs. In fact, total fixed costs will increase by $35,000 per year to cover the increased cost of maintaining the relationship with the supplier. No other costs will change. ME expects to need 100,000 of these parts per year. The potential outsource supplier has an excellent reputation for quality and reliability, and is willing to provide the part for $6.50 per unit. Will ME make more operating income if they outsource the part at the $6.50 price or produce it themselves? What is the highest price per unit ME should be willing to pay to the outsource provider, assuming demand remains stable at 100,000 units per year? Now assume that ME has an opportunity make other use of the space currently devoted to making the part. If it outsources, then it can use this space for storage and will no longer need to rent warehouse space at $120,000 per year. Now will ME make more profit if they outsource the part at a $6.50 price or produce it themselves, and what is the difference in operating income between the two alternatives