1. Acme currently manufactures and sells 13,000 power saws per month, although it has the capacity to produce 28,000 units per month. At the 13,000-unit-per-month level of production, the per-unit cost is $50, consisting of $32 in variable costs and $18 in fixed costs. Acme sells its saws to retail stores for $73 each. Ace Hardware has offered to purchase 4,300 saws per month at a reduced price. Acme can manufacture these additional units with no change in its present level of fixed manufacturing costs.

Using an incremental analysis approach, Acme should consider accepting this special order only if the price per unit offered by Ace Hardware is at least:

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