suppose you started a business: here are some points

revenue- 100,000

variable cost-80,000

fixed cost- 6,000

tax rate- 25%

however to be eligable for loan from the bank, the company has determined that it has to increase and at least double its current dollar contribution to profit.

1. what is the Contribution margin?

2. if the firm decided to increase sales by 50% what would the new profit be?

3. if the firm decided to reduce the fixed cost by 50% what would the new profit be?

4.if the firm decided to reduce the variable cost by 20% what would the new profit be?