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Arma Ltd manufactures notebooks and is considering increasing the price by 20p per unit for the coming month. T his is expected to lead to
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Arma Ltd manufactures notebooks and is considering increasing the price by 20p per unit for the coming month.
This is expected to lead to a fall in demand by 2,000 units.
Currently Projected
Demand 30,000 units 28,000 units
Selling price 1.8 2
Cost per unit 1.1 1.1
If Arma implemented the price increase, operating profit is expected to:
a. None of the above
b. decrease by 4,200
c. increase by 2,000
d. increase by 4,200
Arma Ltd manufactures notebooks and is considering increasing the price by 20p per unit for the coming month.
This is expected to lead to a fall in demand by 2,000 units.
Currently Projected
Demand 30,000 units 28,000 units
Selling price 1.8 2
Cost per unit 1.1 1.1
If Arma implemented the price increase, operating profit is expected to:
a. | None of the above | |
b. | decrease by 4,200 | |
c. | increase by 2,000 | |
d. | increase by 4,200 |
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