d. Calculate monthly operating income (or loss) if a $2 per unit reduction in selling price results in a volume increase to 8,100 units per month. (Do not round intermediate calculations.)

e. What questions would have to be answered about the costvolumeprofit analysis simplifying assumptions before adopting the price cut strategy of part d? (Select all that apply.)

Check All That Apply

• Does the increase in volume move fixed expenses into a new relevant range?

• Does the increase in volume move variable expenses into a new relevant range?

• Are variable expenses really linear?

• Are fixed expenses really linear?