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QUESTION 2 (60 points) With reference to the company in Question 1, assume price and demand are unrelated. The company sells the hair dryers for

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QUESTION 2 (60 points) With reference to the company in Question 1, assume price and demand are unrelated. The company sells the hair dryers for $80 each if they spend $8,000 per month on advertising (C). C, and c remain as indicated in Question 1. The maximum production capacity is 5,000 hair dryers per month. a) What is the demand breakeven point? b) Is the company's demand breakeven point (in %) more sensitive to 10% increase in sales price or 20% reduction in variable costs? Explain your answer. QUESTION 2 (60 points) With reference to the company in Question 1, assume price and demand are unrelated. The company sells the hair dryers for $80 each if they spend $8,000 per month on advertising (C). C, and c remain as indicated in Question 1. The maximum production capacity is 5,000 hair dryers per month. a) What is the demand breakeven point? b) Is the company's demand breakeven point (in %) more sensitive to 10% increase in sales price or 20% reduction in variable costs? Explain your

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