Required: 1. Identify the numbered components in the CVP graph. 2. State the effect of each of the following actions on line 3, line 9, and the break-even point. For line 3 and line 9, state whether the action will cause the line to: Interpretive Questions on the CVP Graph (L02, L06] A CVP graph such as the one shown below is a useful technique for showing relationships among an organization's costs, volume, and profits. Remain unchanged. Shift upward. Shift downward. Have a steeper slope (i.e., rotate upward). Have a flatter slope (ie., rotate downward). Shift upwardand have a steeper slope. Shift upwardand have a flatter slope, Shift downwardand have a steeper slope. Shift downwardand have a flatter slope. In the case of the break-even point, state whether the action will cause the break-even point to: Remain unchanged. Increase Decrease Probably change, but the direction is uncertain. Treat each case independently X. Example. Fixed costs are reduced by $5,000 per period. d. Two thousand more units are sold during the period than were budgeted. Answer (see choices above): Line 3: Shift downward. Line 9: Remain unchanged. e. Due to paying salespersons a commission rather than a flat salary, fixed costs are reduced by $8,000 per period and unit variable costs are increased by $3. Break-even point: Decrease a. The unit selling price is increased from $ 18 to $20. b. Unit variable costs are decreased from $ 12 to $ 10. c. Fixed costs are increased by $3,000 per period. 7. Due to an increase in the cost of materials, both unit variable costs and the selling price are increased by $2. g. Advertising costs are increased by $10,000 per period, resulting in a 10% increase in the number of units sold. h. Due to automating an operation previously done by workers, fixed costs are increased by $12,000 per period and unit variable costs are reduced by $4