The July contribution format income statement of Doxtater Corporation appears below: I
Sales $ 564,400
Variable expenses 312,800
Contribution margin 251,600
Fixed expenses 193,800
Net operating income $ 57,800

If the company's sales increase by 19%, its net operating income should increase by about: (Round your intermediate calculations to 2 decimal places.)

a.10%
b. 83%
c.186%
d.19%

The correct answer is B.

Explanation:

Giving the following information:

Sales $ 564,400

Variable expenses 312,800

Contribution margin 251,600

Fixed expenses 193,800

Net operating income $ 57,800

First, we need to calculate the new net operating income. Then, compare it to the old one and calculate the percentual change.

Sales= 564,400*1.19= 671,636

Variable expenses= (312,800*1.19)= (372,232)

Contribution margin= 299,404

Fixed expenses= (193,800)

Net operating income= 105,604

%change= (income 1 - income 0)/income 0

%change= (105,604 - 57,800)/ 57,800=  0.827= 83%

answer; bootstrapping is your answer;

answer: in the short-run firms will respond by raising the price of turkey.

explanation: initially the long-run equilibrium is at a price of $5 per pound of turkey and a quantity of 50 million pounds per year. now, when webmd claims that a protein found in turkey will increase your expected lifespan by 4 years. the consumers demand for turkey will increase at every price shifting the demand curve to the right from d1 to d2. while, there will be no change in the supply curve in the short-run as it is not possible for producers to adjust supply so quickly. as a result the new equilibrium will occur at a higher price and a higher quantity of turkey.

thus, in the short run firms will respond by increasing the price of turkey, selling more quantity at a higher price and earning economic profits.