Question: Problem 2 Audio Cables, Inc., is currently manufcturing an adapter that has a variable cost of $1.60 per unit and a selling price of $3.60

Problem 2 Audio Cables, Inc., is currently manufcturing an adapter that has a variable cost of $1.60 per unit and a selling price of $3.60 per unit. Fixed costs are $30,000. Current sales volume is 44,000 units. The firm can substantially improve the product quality by adding a new piece of equipment at an additional fixed cost of $20,000. Variable costs would increase to $2.0, but sales volume should jump to 72,000 units due to a higher quality product. Q3 Should Audio Cables buy the new equipment? Why or why not

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