Lady MacBath is a business selling bottles of dry cleaning solvent (spot remover) for \(\$ 10\) each. The variable cost for each bottle is \(\$ 4\). Lady MacBath's total fixed cost for the year is \(\$ 3600\). Required:

a Answer the following questions about the business' break-even point.

i How many bottles of spot remover must Lady MacBath sell to break even?

ii How would your answer to (a-i) change if Lady MacBath lowered the selling price per bottle by \(\$ 2\) ? What if, instead, it raised the selling price by \(\$ 2\) ?

iii How would your answer to (a-i) change if Lady MacBath raised the variable cost per bottle by \(\$ 2\) ? What if, instead, it lowered the variable cost by \(\$ 2\) ?

iv How would your answer to (a-i) change if Lady MacBath increased the total fixed cost by \(\$ 60\) ? What if, instead, Lady MacBath decreased the total fixed cost by \(\$ 60\) ?

b Answer the following questions about the business' profit.

i How many bottles must Lady MacBath sell to earn $4800 profit?

ii How would your answer to (b-i) change if Lady MacBath lowered the selling price per bottle by $2?

iii Suppose that for every \(\$ 1\) the selling price per bottle decreases below its current selling price of \(\$ 10\) per bottle, Lady MacBath predicts sales volume will increase by 325 bottles. Assume that before lowering the selling price, Lady MacBath predicts that it can sell exactly 1400 bottles. Can Lady MacBath earn \(\$ 4800\) profit by lowering the selling price per bottle by \(\$ 2\) ? Explain why or why not.
iv Suppose that for every \(\$ 1\) the selling price per bottle increases above its current selling price of \(\$ 10\) per bottle, Lady MacBath predicts sales volume will decrease by 200 bottles. Assume that before raising the selling price, Lady MacBath predicts that it can sell exactly 1400 bottles. Can Lady MacBath earn \(\$ 4800\) profit by raising the selling price per bottle by \(\$ 2\) ? Explain why or why not.
v How would your answer to (b-i) change if Lady MacBath raised the variable cost per bottle by \(\$ 2\) ? What if, instead, it lowered the variable cost per bottle by \(\$ 2\) ?
vi How would your answer to (b-i) change if Lady MacBeth raised the total fixed cost by \(\$ 60\) ? What if, instead, Lady MacBeth lowered the total fixed cost by \(\$ 60\) ?