Pharoah Orthotics Company distributes a specialized ankle support that sells for $ 40. The companys variable costs are $ 30 per unit; fixed costs total $ 360,000 each year.

(a 1) Calculate contribution margin ratio. (Round ratio to 2 percentage places, e.g. 0.38 = 38%.) % Contribution margin ratio e Textbook and Media Save for Later Attempts: 0 of 3 used Submit Answer (a2) If sales increase by $ 57,000 per year, by how much should operating income increase? (Use the rounded contribution margin ratio calculated in the previous part.) $ Change in operating income e Textbook and Media Save for Later Attempts: 0 of 3 used Submit Answer (b) Last year, Pharoah sold 38,000 ankle supports. The company's marketing manager is convinced that a 10% reduction in the sales price, combined with a $ 48,000 increase in advertising, will result in a 36% increase in sales volume over last year. Compute the projected income. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Projected income $ Should Pharoah implement the price reduction? implement the price reduction because the estimated operating income is than the current operating income