For a consumer product, the manufacturers suggested retail price (MSRP) is $20.00. The wholesale price from the manufacturer to the retailer is $13.00. The manufacturer faces a marginal cost of $9.00 per unit to produce.

Assume that the retailer seeks to lay the entire burden of the sale on the manufacturer, such that the retailer offers consumers a $2-off sale and the price that it pays the manufacturer for the product decreases by $2.

What is the volume hurdle faced by the retailer in this scenario?

What is the volume hurdle faced by the manufacturer in this scenario?