Easywriter manufactures an erasable ballpoint pen, which sells for $1.75 per unit. management recently finished analyzing the results of the company's operations for the current month. at a break-even point of 40,000 units, the company's total variable costs are $50,000 and its total fixed costs amount to $20,000.

a. calculate the contribution margin per unit. (round your answer to 2 decimal places.)

b. calculate the company's margin of safety if monthly sales total 45,000 units.

c. estimate the company's monthly operating loss if it sells only 38,000 units. d-1. compute the total cost per unit at a production level of 40,000 pens per month. (round your answer to 2 decimal places.) d-2. compute the total cost per unit at a production level of 50,000 pens per month.

1. consider a two-firm industry. firm 1 (the incumbent) chooses a level of output qı. firm 2 (the potential entrant) observes qı and then chooses its level of output q2. the demand for the product is p 100 q, where q is the total output sold by the two firms which equals qi +q2. assume that the marginal cost of each firm is zero. a) find the subgame perfect equilibrium levels of qi and q2 keeping in mind that firm 1 chooses qi first and firm 2 observes qi and chooses its q2. find the profits of the two firms-n1 and t2- in the subgame perfect equilibrium. how do these numbers differ from the cournot equilibrium? b) for what level of qi would firm 2 be deterred from entering? would a rational firm 1 have an incentive to choose this level of qi? which entry condition does this market have: blockaded, deterred, or accommodated? now suppose that firm 2 has to incur a fixed cost of entry, f> 0. c) for what values of f will entry be blockaded? d) find out the entry deterring level of q, denoted by q1', a expression for firm l's profit, when entry is deterred, as a function of f. for what values of f would firm 1 use an entry deterring strategy?