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COMPANY currently sells 500 units of its manufactured product per month for $320 per unit. At this current level of sales, COMPANY incurs $45,000 in
COMPANY currently sells 500 units of its manufactured product per month for $320 per unit. At this current level of sales, COMPANY incurs $45,000 in variable expenses and $56,000 in fixed expenses. The sales manager believes that by increasing the monthly advertising budget by $18,000, monthly sales would increase to a total of 850 units. She does not expect a change in the sales price despite the increased sales. What would the change in net operating income be as a result of this increase in the marketing budget assuming that COMPANY sells all the units it produces? Input O if there is no change in net operating income. Input the change as a positive figure if net operating income increases due to this change. Input the change as a negative figure if net operating income decreases due to this change
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