7. On a PV graph, break-even is located at what point? 8. Lightfoot Company sells its product for $65 per unit and has variable costs of $55 per unit. Total fixed costs are $20,000. Suppose variable costs increase by 10% due to an increase in the cost of direct materials and fixed costs decrease by 5% due to a decrease in the cost of insurance. What will be the effect on the breakeven point in units? A. Increase 1,222 units B. Increase 2,222 units C. Decrease 2,222 units D. Decrease 1,222 units 9. ABC Company sells two products, A and B. Product A sells for $30 per unit with variable costs of $20 per unit. Product B sells for $28 per unit with variable costs of $20 per unit. Total common fixed costs for ABC Company are $48,000. ABC Company typically sells six units of Product A for every four units of Product B. What is the breakeven point just for Product B? A. 1,887 units of Product B B. 1,987 units of Product B C. 2,087 units of Product B D. 2,187 units of Product B 10. A managerial preference for a very low degree of operating leverage might indicate that