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FDP Company produces a variety of home security products. Gary Price, the company's president is concerned with the fourth-quarter market demand for the company's products. Unless something is done in the last two months of the year, the company is likely to miss. its earnings expectation of Wall Street analysts. Price still remembers when FDP's earnings were below analysts' expectation by two cents a share three years ago, and the company's share price fell 19% the day earnings were announced. In a recent meeting. Price told his top management that something must be done quickly. One proposal by the marketing vice president was to give a deep discount to the company's major customers to increase the company's sales in the fourth quarter. The company controller pointed out that while the discount could increase sales, it may not help the bottom line; to the contrary, it could lower income. The controller said. "Since we have enough storage capacity, we might simply increase our production in the fourth quarter to increase our reported profit." Required 1. Gary Price is not sure how the increase in production without a corresponding increase in sales could help boost the company's income Explain to Price how reported income varies with respect to production level 2. Is there an ethical concer in this situation? If so, which parties are affected? Explain Your post will be graded as follows: Addresses promote fully using standard English grammar and see A substantial response to one classmate (do not just say ce post or apo using standard English grammar and spelling Abstantial response to one more classmate do not say Nice pour reste standard Eneashrammar and selling Total Possible 104 NO 10W TOON

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