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The Abner Corporation, a retail seller of television sets, wants to determine how many tele vision sets it must sell to earn a profit of $12,000 per month. The price of each television set is $300, and the average variable cost is $100.
Problem a. What is the required sales volume if the Abner Corporation's monthly fixed costs are $5,000 per month?
Problem b. If the firm sells each television set at a price of $350 rather than $300, what is the required sales volume?
Problem c. If the price is $350, and if average variable cost is $85 rather than $100, what is the required sales volume?
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