. Giant Company has three products, A, B, and C. The following information is available:

Product AProduct BProduct C

Sales$70,000$97,000$23,000

Variable costs37,00051,00015,000

Contribution margin33,00046,0008,000

Fixed costs:

Avoidable10,00020,0003,000

Unavoidable7,00012,0009,400

Operating income$16,000$14,000$ (4,400)

Giant Company is thinking of dropping Product C because it is reporting a loss. Assuming Giant drops Product C and does NOT replace it, operating income will ________.

A) decrease by $5,000

B) increase by $3,000

C) decrease by $6,000

D) increase by $4,400