I am stuck on a problem we have to do for homework.
A manufacturing company reports the following operating results for the month:
Sales $500,000 (units 5,000)
Variable costs $300,000
Fixed costs $180,000
They believe they can improve profits by increasing the sales price per unit by 10% even though this would result in a 10% decrease in sales volume (units). What would be the effect on net income if management does this?