Schweser Satellites Inc. produces satellite earth station that sell for $100,000 each. The firms fixed costs, F, are $2 million, 50 earth stations are produced and sold each year, profits total $500,000, and the firms assets (all equity financed) are $5 million, The firm estimates that it can change its production process, adding $4 million to assts and $500,000 to fixed operating costs. This change will reduce variable cots per unit by $10,000 and increase output by 20 units. However, the sales price on all units must be lowered to $95,000 to permit sales of the additional output. The firm has tax loss carryforwards that render its tax rate zero, its cost of equity is 16%, and it uses no debt.

B. Would the firms break-even point increase or decrease if it made the change?