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Question: International Data Systems information on revenue and costs is only relevant up to a sales volume of 100,000 units. After 100,000 units, the market becomes saturated and the price per unit falls from $4.00 to $3.80. Also, there are cost overruns at a production volume of over 100,000 units, and variable cost per unit goes up from $2.00 to $2.20. Fixed costs remain the same at $50,000.

a. Compute operating income at 100,000 units.

b. Compute operating income at 200,000 units.

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M92596013

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