Recent economic conditions are forcing MegaCorp to drop its price from $50 to $40 per unit, but the company expects its sales to rise from 600,000 to 750,000 units. The company produces exactly enough units to meet sales expectations and the company's current cost of production is $38 per unit. Of that $38 per unit, $10 per unit is a result of fixed costs, which was calculated by dividing the fixed costs by expected sales of 600,000. Fixed costs will remain the same despite the price and production changes. 

Suppose MegaCorp would like to maintain a 16% target operating income on its sales revenue. To achieve this target, the company must lower its variable cost of production by?