E$6\mathrm{.}20($LO $2,3)$ Kirkland Video Games Ltd$.$ is developing a new video game. It is the most sophisticated game on the market. It sells the video game for $$250$ per copy. Variable costs to produce and sell the video game amount to $$50$ per copy. Fixed costs amount to $$450,000.$ The company anticipates selling $300$ copies of the game per month. The company's policy is to stop producing the video game as soon as a competitor comes out with a more sophisticated version.

Instructions

a$.$ Calculate the amount of operating income the company will earn if it takes $10$ months for a competitor to produce a more sophisticated version of the video game.

b$.$ Calculate how many units of the video game the company will have to sell in order to break even.

c$.$ If the company wishes to earn $$30,000$ over the product's life, calculate the selling price of the video game if a competitor introduces a more sophisticated version of the video game in six

E$6\mathrm{.}20($LO $2,3)$ Kirkland Video Games Ltd$.$ is developing a new video game. It is the most sophisticated game on the market. It sells the video game for $$250$ per copy. Variable costs to produce and sell the video game amount to $$50$ per copy. Fixed costs amount to $$450,000.$ The company anticipates selling $300$ copies of the game per month. The company's policy is to stop producing the video game as soon as a competitor comes out with a more sophisticated version.

Instructions

a$.$ Calculate the amount of operating income the company will earn if it takes $10$ months for a competitor to produce a more sophisticated version of the video game.

b$.$ Calculate how many units of the video game the company will have to sell in order to break even.

c$.$ If the company wishes to earn $$30,000$ over the product's life, calculate the selling price of the video game if a competitor introduces a more sophisticated version of the video game in six