[The following information applies to the questions displayed below.] Data for Hermann Corporation are shown below: Per Unit $ 125 Percent of Sales 100% 64% Selling price Variable expenses 80 Contribution margin $ 45 36% Fixed expenses are $85,000 per month and the company is selling 2,700 units per month. 3. value: 10.00 points Required: 1-a. The marketing manager argues that a $9,000 increase in the monthly advertising budget would increase monthly sales by $20,000. Calculate the increase or decrease in net operating income. Net operating income decreases by $ 1,800 1-b. Should the advertising budget be increased? O Yes Hints References eBook & Resources Hint #1 Check my work 4. value: 10.00 points 2-a. Refer to the original data. Management is considering using higher-quality components that would increase the variable expense by $5 per unit. The marketing manager believes that the higher-quality product would increase sales by 20% per month. Calculate the change in total contribution margin. Total contribution margin increases by $ 175,500 4. value: 10.00 points 2-a. Refer to the original data. Management is considering using higher-quality components that would increase the variable expense by $5 per unit. The marketing manager believes that the higher-quality product would increase sales by 20% per month. Calculate the change in total contribution margin. Total contribution margin increases by $ 175,500 2-b. Should the higher-quality components be used? O Yes O No