Pro Sports Inc. manufactures basketballs for professional basketball associations. For the first six months of 2020, the company reported the following operating results while operating at 90% of plant capacity:
Per Unit
Sales
Amount
$5,875,200
4,032,000
472,320
$51.00
35.00
Cost of goods sold
Selling and administrative expenses
Net income
4.10
$1,370,880
$11.90
Fixed costs for the period were cost of goods sold of $1.152,000, and selling and administrative expenses of $207,360.
In July, normally a slack manufacturing month, Pro Sports receives a special order for 11.520 basketballs at $32 each from the
Italian Basketball Association. Accepting the order would increase variable selling and administrative expenses by $0.25 per unit
because of shipping costs, but it would not increase fixed costs and expenses.

a) prepare incremental analysis for the special order.

b) what is the minimum selling price on the special order to produce net income of $6.00 per ball?​

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?