Healthy Ltd has two product lines: Basic and Premium. Business costs have been divided roughly into their variable and fixed elements. The business is considering whether to drop one of the product lines. The following financial information about each of the product line has been provided: Basic line Premium line Total Sales revenue $100,000 $80,000 $180,000 Less Cost of goods sold ($20,000) ($32,000) ($52,000) Less Other variable costs ($10,000) ($12,000) ($22,000) Contribution Margin $70,000 $36,000 $106,000 Less Avoidable fixed costs ($25,000) ($6,000) ($31,000) Less Unavoidable fixed costs ($5,000) ($20,000) ($25,000) Profit $40,000 $10,000 $50,000 Question: If the business drops Basic product line, what will happen to total profit? Group of answer choices

1.Total profit will reduce by $65,000.

2. Total profit will reduce by $30,000.

3.Total profit will reduce by $40,000.

4.Total profit will reduce by $45,000.