Company XYZ is trying to determine the break-even analysis to cover its fixed costs.

Fixed costs: $20,000

Variable cost per unit: $2.50

Total units sold: 40,000

1. What is the selling price per unit Company XYZ needs to break even?

2. What variable is this project most sensitive to, assuming a 20% change (use the breakeven price as the base)? Hint: (use price per unit, variable cost per unit, units sold, and fixed cost to base your sensitive analysis )