Multiple Choice Question

Wilson Co$.$ currently produces $2,000$ tennis rackets annually. A supplier has offered to produce the rackets for $$370$ per racket. Wilson incurs unit$-$level costs of

$$360$ per racket and spends $$10,000$ on product design each year. Annual facility$-$level costs are $$100,000.$ What is the effect on profit if Wilson Co$.$ outsources

the rackets?

$$10,000$ increase

$$110,000$ decrease

$$110,000$ increase

$$10,000$ decrease