b. The company currently has 95,000 subscribers and
proposes to raise its monthly fees to $39.95 to
cover add-on features such as text messaging, song
downloads, game playing, and video watching.
What is the new breakeven point if the variable cost
increases to $25 per customer per month?
c. If 20,000 subscribers will drop their service because
of the monthly fee increase in Part (b), will the
company still be profitable?