Question: use the given method below to solve. Product X is selling for $40/unit. Its variable costs are $20/unit. Fixed costs associated with this product are

use the given method below to solve.

Product X is selling for $40/unit. Its variable costs are $20/unit. Fixed costs associated with this product are $300,000/year. The company expects to sell 250,000 of Product X a year. 1. What is the current annual profit of Product X? 2. What is the breakeven point in units for Product X? 3. Suppose the company decides it wants to charge a 20% markup on cost. What would the target return price of Product X be? 4. The company decides not to change the price of Product X to the price calculated in #3 and keeps the $40/unit. But in response to competition, the price of Product X drops to $36 and the company sells 260.000 units that year. Calculate the price elasticity of demand based on the original price and data and the latest price and data. Use Midpoint Method P. E. of D. = {[Q2-QY(Q2 + Q1)/2]} {[P2-PVP,+P_)/2]}

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