1. The AMZ Balderdash Company has two brands ("A" & "B"). Price and cost data for each are presented below. "A" "B" Unit price $3.45 $4.15 Unit variable cost $2.05 $1.95 Unit volume/year 725,000 units 1,255,000 units Annual Promotional expense $645,000 $895,000 a) What are the respective brand contribution margins ($) of "A" and "B" to the AMZ Company? Assuming that AMZ Company is profit oriented and wishes to retain only one of these brands which brand would you recommend for retention? Explain your reasoning and state your assumptions! (6 POINTS) 0 "A" ii) "B" I b) Given a 15% price cut, estimate the breakeven elasticity of each brand. Briefly discuss the implications of each B/E elasticity. (4 points) c) It has been proposed that the price of each brand be reduced by 15%. Unit variable costs are unchanged. What would be the new unit contribution margin and unit contribution margin ratio for each brand, assuming no change in unit variable costs? (4 POINTS)