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Minden Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company
Minden Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company can increase sales by 5,400 units for each $2 reduction in the selling price. The companys present selling price is $66 per unit, and variable expenses are $38 per unit. Fixed expenses are $600,000 per year. The present annual sales volume (at the $66 selling price) is 20,000 units. Required: 1. What is the present yearly operating income or loss? 2. What is the present break-even point in unit sales and in dollar sales? (Round intermediate calculations and final answers to
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