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More Info 1 1. Replace a portion of its variable labor with an automated machining process. This would result in a 15% decrease in variable cost per unit, but a 10% increase in fixed costs. Sales would remain the same. 2. Spend $35,000 on a new advertising campaign, which would increase sales by 30%. 3. Increase both selling price by $10 per unit and variable costs by $8 per unit by using a higher quality leather material in the production of its shoes. The higher priced shoe would cause demand to drop by approximately 15%. 4. Add a second manufacturing facility that would double Nubuck's fixed costs, but would increase sales by 60%