Gleason sells a single product at $14 per unit. The firm's most recent income statement revealed unit sales of 80,000, variable costs of $800,000, and fixed costs of $560,000. Management believes that a $3 drop in selling price will boost unit sales volume by 20%. Which of the following correctly depicts how these two changes will affect the company's break-even point?

Drop in sales price will increase or decrease? Increase in Sales Volume will increase, decrease, no effect? Please show the analysis for solving this problem.

Answer rating: 100% (QA)

Solution i price 14 umit varcable Cost 10 go0000 Soo00 10umit prce varable cost br... View the full answer