Question: Birchfields management is looking at longer term solutions to improve net income. One of the options they have reviewed will increase fixed expenses by $$27,500$ while reducing variable expenses by $$2$ per unit. Management feels that with these changes the price of the product could be reduced by $$1$ per unit. The decrease in price will then result in anBirchfields management is looking at longer term solutions to improve net income. One of the options they have reviewed will increase fixed expenses by $$27,500$ while reducing variable expenses by $$2$ per unit. Management feels that with these changes the price of the product could be reduced by $$1$ per unit. The decrease in price will then result in an increase in unit sales of $5\%.$ Compute the net income to be earned under this alternative. Do you recommend this option? Why or why not?