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Let the cost of each mechanical pencil be $x.
Since each eraser costs $0.50, and there are 10 erasers in a bundle, the cost of each bundle of erasers is $0.50 * 10 = $5.
Mr. Spears had $25 to spend, so he has 25 - 5 = $<<25-5=20>>20 left to spend on mechanical pencils.
Therefore, the cost of each mechanical pencil is $20 / (10 pencils) = $<<20/10=2>>2.
The missing place in the equation to compute the cost of each mechanical pencil is x = 2.