X Company is considering buying a part next year that it currently makes. The budgeted cost function to produce the part is $11.53X + $10,500, where X is the number of units produced. A company has offered to supply this part to X Comany it for $14.19 per unit. If X Company chooses to buy the part, it will avoid fixed costs of $5,250, and it will be able to lease the resources that will become available from not making the part for $2,200.

1. If X Company makes the part next year instead of buying it, and production is expected to remain at 3,500 units, it will save

A: $1,052

B: $1,398

C: $1,860

D: $2,474

E: $3,290

F: $4,376

2. If X Company makes the part next year instead of buying it, and production next year is expected to be 3,900 units, it will save

A: $1,653

B: $2,198

C: $2,924

D: $3,889

E: $5,172

F: $6,879