Servicepro provides two kinds of services. during the most recent accounting period, the two service lines produced the following operating results:

service 1 service 2
service revenue $ 110,000 $ 40,000
unit-level materials $ (26,000) $ (8,000)
unit-level labor $ (36,000) $ (20,000)
product-level selling
& administrative costs $ (16,000) $ (9,500)
company wide
facility-level costs $ (4,000) $ (4,000)
net income $ 28,000 $ (1,500)

if the company stops providing service 2:

the company's income will increase by $3,500 per year.
the company's income will decrease by $3,500 per year.
the company's income will increase by $2,500 per year.
the company's income will decrease by $2,500 per year.