Answer one question from this section. 1. Small-Scale Hobbies (SSH) Scale Airplane Modeller is a magazine produced by Small-Scale Hobbies (SSH). The company sells the magazine through independent retail outlets in the US. The finance director produced a summary of 2018's financial information. Last year's break-even chart showed that SSH had a margin of safety of 20000 units. Table 1: Selected financial data for SSH for 2018: Annual fixed costs $100 000 Variable costs per magazine produced $2 Magazine price $4.50 This year, to reduce costs and to increase sales, the company will introduce new production methods, which will reduce: unit variable costs by 10% fixed costs by $5000 per year. (a) Define the term margin of safety. [2] (b) Using the financial data in Table 1, calculate: (i) the break-even level of output (show all your working); [2] (ii) the percentage of total costs that were fixed costs for last year (show all your working); [2] (iii) the level of profit for SSH at 2018's level of production (show all your working). [2] (c) Explain how the introduction of new production methods will affect the total cost line in SSH's break-even chart. [2]