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2) Air Perak Products (APP) manufactures humidifiers and air filtration equipment. Last year was a below average year for sales but APP expects the market

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2) Air Perak Products (APP) manufactures humidifiers and air filtration equipment. Last year was a below average year for sales but APP expects the market to grow significantly this year. Last year's income statement was: To take advantage of the anticipated growth in the market, APP is considering the following courses of action: a) Do nothing. If APP does nothing, it expects sales to increase by 12%. b) Spend $2,000 on a new advertising campaign that is expected to increase sales by 40%. c) Raise the price of the products to an average of $300 per unit. This is expected to decrease sales quantities by 25%. d) Redesign the product line and increase the selling price of the products to an average of $375 per unit, while increasing the variable costs by $70 per unit. The sales level is not expected to change from last year. Evaluate each of the alternatives considered by APP by calculating the operating income for each alternative. What should APP do

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