BaileyBailey$\text{'}$s

current manufacturing process is labor intensive. Kate

KellerKeller$,$

BaileyBailey$\text{'}$s

production$$manager$,$ has proposed investing in$$state$-$of$-$the$-$art manufacturing$$equipment$,$ which will increase the annual fixed costs to

$ $5$ comma $200$ comma $000$$$5,200,000.$

The variable costs are expected to decrease to

$ $41$$$41$

per unit.

BaileyBailey

expects to maintain the same sales volume and selling price next year. How would acceptance of

KellerKeller$\text{'}$s

proposal affect your answers to$($a$)$ and$($b$)$ in requirement$1?$