George's Gym evaluates the profitability of three segments: membership fees, personal training, and merchandise. The financials are:

Segment	Revenue	Direct Costs
Membership Fees	$500,000	$300,000
Personal Training	$200,000	$120,000
Merchandise	$90,000	$50,000

George is considering converting the merchandise area into an expanded personal training area.

Required: a. By how much must the personal training segment margin increase to maintain George’s Gym’s current income? b. Discuss other factors George should consider before deciding to eliminate the merchandise area to expand personal training.