Marathon Company makes and sells a single product. The current selling price is $19 per unit. Variable expenses are $11.4 per unit, and fixed expenses total $55,240 per month.

d. Calculate monthly operating income (or loss) if a $2 per unit reduction in selling price results in a volume increase to 8,050 units per month.

Note: 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?

f. Calculate the monthly operating income (or loss) that would result from a $1 per unit price increase and a $6,000 per month increase in advertising expenses, both relative to the original data. Assume a sales volume of 7,400 units per month. Is the increase in advertising expense justified by the price increase?