Cost-Volume-Profit Analysis UPS offers overnight package delivery to California business customers. The company decided to expand its facilities to better satisfy current and projected demand. Current volume totals 2 million packages per week at a price of $12 each, and AVC are constant at all output levels. Fixed cost are $3 million per week, and profit contribution averages one-third of revenues on each delivery. After completion of tht expansion, TFC will double, but variable cost will decline by 25%.

1. Calculate the change in UPS's weekly breakeven output (BEQ) level that is due to expansion.

2. Assuming volume remains 2 million packages per week, calculate the change in the degree of operating leverage (DOL) due to expansion.

3. Assuming volume remains 2 million, calculate the effect of expansion on monthly profit.