ePlay Ltd manufactures video game consoles. The firm$$s fixed costs are

$$4000000$ per year. The variable cost of each console is $$200,$ and the

consoles are sold for $$300$ each. The company sold $50000$ consoles

during the previous year. $($In the following requirements, ignore income

taxes.$)$

Required

Treat requirements $1$ to $4$ as independent situations:

$1.$ Calculate the break$-$even point in units.

$2.$ What will the new break$-$even point be if fixed costs increase by

$10$ per cent?

$3.$ What was the company$$s net profit for the previous year?

$4.$ The sales manager believes that a reduction in the sales price to

$$250$ will result in $12000$ more consoles being sold each year.

What will the break$-$even point be if the price is changed?

$5.$ Should the price change discussed in requirement $4$ be made?

Explain.