Clint Westwood, famous Hollywood actor, currently is negotiating with Pasta Corporation of America (PCA) to endorse PCA pasta mix. The lawyer for PCA has offered Westwood two options:

(1) Payment of $1 per sales unit (box of pasta mix)

(2) Payment of $.50 per unit plus fee of $80,000.

At which sales level (in units) would Westwood be indifferent between the two contracts?

a.

zero

b.

80,000

c.

160,000

d.

320,000

e.

none of the above