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Directions: All pages must be turned in at the end of the exam. READ CAREFULLY, SHOW YOUR WORK, AND PUT YOUR FINAL ANSWERS IN EACH
Directions: All pages must be turned in at the end of the exam. READ CAREFULLY, SHOW YOUR WORK, AND PUT YOUR FINAL ANSWERS IN EACH BOX. 1. Blaster Radio Company is trying to decide whether or not to introduce a new model. If they introduce it, there will be additional fixed costs of $400,000 per year. The variable costs have been estimated to be $20 per radio. (a) If Blaster sells the new radio model for $30 per radio, how many must they sell to break even? (3pts) (b) If Blaster sells 70,000 of the new radio model at the S30 price, how much profit will be made? (3pts) (c). What is the break-even volume given if the total fixed cost is increased to $500,000, total variable costs are $40, and the new selling price is $80? (4pts)
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