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The Miller Company manufactures wiring tools. The company is currently producing well below its full capacity. The Brisbois Company has approached Miller with an offer to buy 5,000 tools at $17.50 each. Miller sells its tools wholesale for $18.50 each; the average cost per unit is $18.30, of which $2.70 is fixed costs. Assume that Miller is operating at full capacity. If Miller were to accept Brisbois’ offer, what would be the change in Miller’s operating profits?
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