traus Company operates a small factory in which it manufactures two products: A and B. Production and sales results for last year were as follows:

		A		B
Units sold		4,380		10,100
Selling price per unit		$98		$76
Variable costs per unit		51		53
Fixed costs per unit		20		20

For purposes of simplicity, the firm averages total fixed costs over the total number of units of A and B produced and sold. The research department has developed a new product (C) as a replacement for product B. Market studies show that Straus Company could sell 5,750 units of C next year at a price of $120; the variable costs per unit of C are $48. The introduction of product C will lead to a 10% increase in demand for product A and discontinuation of product B. If the company does not introduce the new product, it expects next year