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Let’s assume a profitable business is operating at a level where for the foreseeable future, its costs will appear to be 30% fixed and 70% variable

Let’s assume a profitable business is operating at a level where for the foreseeable future, its costs will appear to be 30% fixed and 70% variable. If sales increase by 1%, will it’s profits increase by (1) more than 1%, (2) 1% exactly, or (3) less than 1%? Support your answer.

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