Assume University T-Shirt Shop has a selling price of $25 and unit variable cost of $10 for its long-sleeve cotton shirts. Fixed costs total $1,000. University believes increasing its price to $27 will cause its sales volume to drop by 5 percent. If University's sales volume for the month was estimated to be 300 shirts before the price increase, how will net profit be affected by the change in selling price?

Please Explain Answer