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Leo, the owner of a local poster shop, comes to you for help. We've only been breaking even the past two years, and I'm getting

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Leo, the owner of a local poster shop, comes to you for help. "We've only been breaking even the past two years, and I'm getting very frustrated! I don't know what to do because I feel like I've already tried to improve our processes as much as possible, but we still haven't been able to generate a profit. Do you have any suggestions as to how we can turn things around? I just don't think we can even consider moving forward with this business unless we can earn $10,000 in operating income next year. Even then, we'll have to think long and hard about what the future holds:" Leo shares the following information with you, as you ponder different scenarios to help your friend. After thinking about it for a while, you suggest the following possibilities to help him turn things around. 1. Lower the selling price by 10% to increase sales volume by 5%. 2. Advertise on the radio and with social media, for a combined cost of $1,000, to increase volume by 10%. 3. Use a more affordable paper on which to print the posters (available for $0.6 per unit), in combination with a less-expensive film to cover the top of the poster (available for $0.4 per unit). 4. Instead of paying the salespeople a fixed salary, move to a commission-based compensation plan (save $20,000 in salary: incur $1.5 per unit sold commission), which should increase sales volume by 20%. Analyze each of the proposals against the current situation to determine if it will help Leo achieve his profit goal. (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Round answers to 2 decimal places, e.g. 5.125 .25 \)

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