To produce a product that normally sells for $50, Hayes company incurs costs of $35 per unit, including $20 variable cost and $15 fixed cost. A wholesaler from another country offers to buy 5,000 unites at $30 each. An additional $1 shipping cost will occur for each unit to fulfill the order. Assuming that Hayes has excess operating capacity. Answer the questions below.

1. What will be the key factor that Hayes consider to decide whether to accept or decline the offer?

2. Based on your analysis, do you think Hayes should accept the offer?

3. What if Hayes does not have excess capacity and an additional $50,000 fixed cost will occur if Hayes accept the offer? Should Hayes accept the offer in this scenario?