PROBLEM ONE (35 points) Given: The Magnum Company has a patented process which will make them the sole producer and distributor of product XX. In their first year, they plan to produce and sell 9000 units of XX. Their cost projection for the first year of operations is: Direct Labour :1.5 $ per unit; All other Var. Costs : 1.0 $ per unit; Direct Material Fixed Costs : 0.50 $ per unit; : 24 K$ per annum No other costs are involved. Required: If in the first year of operations they wish to make a profit of 39 K$; a) What should the unit sale price of XX be; b) What is the CMR for the operation. PROBLEM TWO (35 points) Given: The Ratty Company manufactures and sells dresses. The variable cost of each dress is 3$, and the unit sale price is 5$. This year they have already sold 6000 dresses and made a profit of 2K$. Required: a) What is their fixed costs, b) What is the CMR; c) If they now sell 1000 dresses at 3.5 $ per dress, by how much will the profit increase. Note: Only correct solutions obtained by using the contribution margin method will merit points. PROBLEM THREE (30 points) Given: Two shares X and Y. The ARR for X is 24%, and the standard deviation is 12%. The ARR for Y is 50%, and the standard deviation is 20%. Required: Show by appropriate calculations, which share carries the lesser risk