Jensen PVC, Inc., produces polyvinyl chloride (PVC) irrigation pipes. In 2017, the cost of producing a foot of pipe was $0.30, and the selling price was $0.39 per foot. In 2018, production costs increased to $0.40 per foot, although the selling price remained at $0.39. 2017 2018 Selling price $0.39 $0.39 Production cost 0.30 0.40 The increase in cost was obvious. Material and labor had remained fairly constant per foot of pipe, but overhead costs, which were $0.15 per foot in 2017, had increased to $0.25 in 2018. The problem was that most overhead costs were fixed, but output had decreased due to weak crop prices and a corresponding decrease in spending on irrigation projects. Bob Elger, CFO of Jensen, reviewed the data generated by the companys process costing s ystem. In 2017, overhead costs in all of the companys departments (mixing, extrusion, cutting, and packing) were $1,500,000, and pipe production was 10,000,000 feet. In 2018, overhead costs were still approximately $1,500,000, but pipe production decreased to 6,000,000 feet. At a recent meeting of the senior management team, Bob noted: The problem is that were not making use of capacity. We could easily produce 15,000,000 feet of pipe given our state-ofthe- art equipment, but were operating at less than 50% of capacity. REQUIRED Bob estimates that to sell 15,000,000 feet of pipe in the current market, the company would have to lower its price to $0.35 per foot, which is even lower than its current cost per foot of $0.40. Would decreasing the price be a good decision?