Assume University T-shirt Shop has a selling price of $25 and unit variable cost of $10 for its long-sleeve cotton shirts.Fixed costs total $1,000.University believes increasing its price to $27 will not cause a reduction in the number of shirts it will sell.If University's sales volume for the month is 300 shirts, how will net profit be affected by the change in selling price?
A) $1,600 increase.
B) $250 increase.
C) $600 increase.
D) $270 increase.
E) $1,600 decrease.
Correct Answer:
Verified
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