Answer
The decrease in net operating income= Number decrease in units $\times$Contribution margin per unit = 100 $\times$ 8 = 800 (dollars)
Net operating income = Net operating income at first - The decrease in net operating income = 2,000 - 800 = 1,200 (dollars)
Work Step by Step
Number decrease in units = 1,000 - 900 = 100 (units)
Contribution margin per unit = $8 (Calculated in question 1)
Because contribution margin per unit shows us the amount of revenue from the sale of one unit after covering the variable expenses, the decrease in net operating income would be equal to multiplying the number decrease in units with the contribution margin per unit.
