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2. Chips Home Brew Whiskey management forecasts that if thefirm sells each bottl

2. Chips Home Brew Whiskey management forecasts that if thefirm sells each bottle of Snake-Bite for $20 then the demand forthe product will be 15000 bottles per year whereas sales will be90 percent as high if the price is raised 9 percent. Chipsvariable cost per bottle is $10 and the total fixed cash cost forthe year is $100000. Depreciation and amortization charges are$20000 and the firm has a 30 percent marginal tax rate.Management anticipates an increased working capital need of $3000for the year. What will be the effect of the price increase on thefirms FCF for the year? (Round answers to nearest whole dollare.g. 5275.)

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