Sales and Cost Year 1 Year 2 Year 3 Year 4 Unit sales 1,000 1,500 2,000 3,000 Total Sales 1,000 1,500 2,000 3,000 Cost 500 500 500 500 Question 1. Based on the relationship above would you say the cost is xed, variable or stepped? Why? Sale and Cost Year 1 Year 2 Year 3 Year 4 Unit Sales 1,000 1,500 2000 1000 Total Sales 1000 15 00 2000 3000 Cost 500 500 1000 1000 Question 2. Based on the relationship above would you say this cost is xed, variable or stepped? Why? Sales and Cost Year 1 Year 2 Year 3 Year 4 Unit sales 1000 1500 2000 3000 Total Sales 1000 1500 2000 3000 Cost 500 750 1000 1500 Question 3. Based on the relationship above, would you say the cost is xed, variable or stepped? Why? Question 4. What causes cost for an organisation? Question 5. Are all customers equally protable? Please Explain. Question 6. There are two ways to establish a summer lawn mowing business Option 1 is to rent-to-own for 5 years a $20,000 large riding zero-tum lawnmower for $4000 per year and hire one person to operate this for $15 an hour. With this option, the lawns will be mowed very quickly in very little time per lawn Option 2 is to rent to own for ve years push mowers for $200 per mower for $40 per year and hire high schoolers for $15 per hour to push these mowers. With this option, it will take quite a bit longer to mow these lawns. Questions a. Which of these options has a higher xed cost? Which of these options has a higher variable cost per unit? b. Which of these options have higher breakeven point? c. If demand is low and we mow under 20 yards per week, under which option will we lose the most money? (1. If we operate far beyond our breakeven point, (and still within the relevant range of the large mower) and mow 300 yards per week (something we can do with the large riding zero-tum lawnmower). At this level, which option will be more protable or have the highest potential for prot