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Morgan Technologies sells a single product at $20 per unit. The firm's most recent income statement revealed unit sales of 111,000, variable costs of $1,110,000,
Morgan Technologies sells a single product at $20 per unit. The firm's most recent income statement revealed unit sales of 111,000, variable costs of $1,110,000, and fixed costs of $470,000. If a $4 drop in selling price will boost unit sales volume by 20%, the company will experience:
a.) no change in profit because a 20% drop in sales price is balanced by a 20% increase in volume.
b.) an $101,200 drop in profit.
c.) a $310,800 drop in profit.
d.) a $470,000 drop in profit.
e.) None of the answers is correct.
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