2. One of the first decisions you have to make as the brand manager for Flexo is whether or not to add a new line of razors, the "Super Flexo" line. This line would be marketed in addition to the original Flexo line. Your brand assistant has provided you with the following facts: a. Retail selling price $40 per unit b. All margins the same as before c. Direct factory labor $ 3 per unit $ 2 per unit d. Raw materials e. Additional factory and administrative overheads $2 per unit (at a 50,000 unit volume level) f. Salespersons' commissions the same percent as before g. Incremental sales force travel cost $ 50,000 $600,000 h. Advertising for Super Flexo i. New equipment needed $500,000 (to be depreciated over 10 years) $200,000 j. Research and development spent up to now k. Research and development to be spent this year to commercialize the product $500,000 (to be amortized over five years) Questions 1. What is the contribution per unit for the Super Flexo brand? 2. What is the break-even volume in units and in dollars? 3. What is the sales volume in units necessary for Super Flexo to yield, in the first year, a 20 percent return on the equipment to be invested in the project? 3. The $40 per unit selling price for Super Flexo seems high to you. You thought you might lower the price to $37 per unit and raise retail margin to 25 percent. Question What is the break-even volume in units?