1.) Suppose that the NS Corporation has production (and sales) capacity of $ 1,000,000 per month. Its fixed costs are $ 350,000 per month, and the variable costs - over a considerable range of volume - are $ 0.50 per $ of sales.

a. What is the annual breakeven point volume?

b. What will be the effect on the breakeven volume of decreasing

the variable cost per unit by 25% and fixed costs thereby increasing by 10%.

2.) Given that price per unit ($) = 2,000 - D/10, where D is the annual demand (units) and total cost per year can be approximated by $ 2,000 + 2D².

a. What level of annual demand maximizes profit?

b. How do you know you haven't minimized profit?

c. What is the maximum profit ($) per year?

d. What are the break-even points?

e. At what point does the revenue is maximized? What is the

maximum revenue?

3.) Product N currently sells for $ 12 per unit. The variable costs are $ 4 per unit and 10,000 units are sold annually and a profit of $ 30,000 is realized per year. A new design will increase the variable costs by 20% and fixed costs by 10% but sales will increase to 12,000 units per year.

a. At what selling price do the break-even occurs for the new

design?

b. If the selling price is to be kept the same ($ 12 per unit)

what will the annual profit be?

4.) A company produces an electric airfryer that is used in consumer and commercial product. The fixed cost is $ 73,000 per month and the variable cost is $ 83 per unit. The selling price is p = 180 - 0.02D.

a. Determine the optimal volume for this product and the profit

realized at this level.

b. Find the break-even volume/s. What is the range of profitable

demand?

5.) An exporter of leather wallets has just entered a new market. This exporter faces the following relationship between the price of wallets and the demand: