Question: Suppose that marketing executives for Touché Toiletries reduced the price to $6.50 for a three-ounce bottle of Ode d'Toade and the fixed costs were $1,100,000. Suppose further that the unit variable cost remained at 45 cents for a three-ounce bottle.
(a) How many bottles must be sold to break even?
(b) What dollar profit level would Ode d'Toade achieve if 200,000 bottles were sold?