Question
The EV69194 company has provided the following cost, price, and sales data: Per Unit Selling price $ 242 Variable expenses 55 Contribution margin $ 187
The EV69194 company has provided the following cost, price, and sales data:
Per Unit | ||||||||
Selling price | $ | 242 | ||||||
Variable expenses | 55 | |||||||
Contribution margin | $ | 187 | ||||||
The EV69194 company is currently selling 8,200 units per month. Fixed expenses are $878,000 per month.
The marketing manager would like to cut the selling price by $29 and increase advertising spending by $63,000 per month. The marketing manager predicts that these changes would increase monthly sales quantity by 22%. What would be the overall effect on the EV69194 company's monthly net operating income of this change?
Multiple Choice
-
63,520 dollars
-
-15,768 dollars
-
-63,840 dollars
-
13,800 dollars
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started