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Campus Care Packages produces and sells a single product with a selling price of $ 1 4 0 and a 7 0 % CM ratio.
Campus Care Packages produces and sells a single product with a selling price of $ and a CM ratio. Fixed expenses are $ per month. The company is currently selling units per month. The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of $ per unit. In exchange, the sales staff would accept a decrease in their salaries of $ per month. This is the companys savings for the entire sales staff. The marketing manager predicts that introducing this sales incentive would increase monthly sales by units. What should be the overall effect on the companys monthly net operating income of this change?
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