A new business produces a single product and reports the following data:

Price	$14.00	per unit
Variable cost	$9.00	per unit
Fixed cost	$70,000	per month
Volume	22,000	per month

If the company reduces its price to $12, it believes that the monthly volume will go up to 70,000 units.

How would this change affect operating income?

Select one:

a. Operating income will increase by $150,000

b. None of these answers

c. Operating income will decrease by $40,000

d. Operating income will increase by $30,000

e. Operating income will increase by $100,000