Advanced Enterprises Reports Year-End Information from 2018 as Follows

Multiple Choice

Advanced Enterprises reports year-end information from 2018 as follows:

Advanced is developing the 2019 budget. In 2019 the company would like to increase selling prices by 14.5%, and as a result expects a decrease in sales volume of 9%. All other operating expenses are expected to remain constant. Assume that cost of goods sold is a variable cost and that operating expenses are a fixed cost.
Should Advanced increase the selling price in 2019?

A) Yes, because operating income increases for 2019.
B) Yes, because sales revenue increases for 2019.
C) No, because sales volume decreases for 2019.
D) No, because gross margin decreases for 2019.