Home / Questions / Blunt Corporation manufactures calculators involving a product line of two models The curr...
Blunt Corporation manufactures calculators, involving a product line of two models. The current price charged for its B1 model is £8, and profit contribution is 25 per cent. Sales have been disappointing for this model, so Blunt is considering a quality improvement at a cost of 50p. per calculator. Advertising would be increased by £40,000 to promote the improvement. Current profit is £60,000 on sales of 80,000 items per month. There is a relationship between sales of B1 and B2 models, such that for every four extra sales of a B1 model there is one less sale of a B2 model, as some consumers switch from one model to the other. The B2 models sell for £6 and have an average variable cost of £5. a. Determine the cost function for the B1 model with the changes that Blunt is considering. b. Calculate the increase in sales of B1 models necessary with the quality improvement in order to earn increased profits of £40,000, ignoring the effect on sales of B2 models. c. Calculate the increase in sales of B1 models necessary with the quality improvement in order to earn increased profits of £40,000, taking into account the effect on sales of B2 models.
2. Haedoo is presently struggling to survive in the motor car industry. Competition is increasing and the company is plagued by overcapacity. Its capacity is 2 million units per year, but it is currently operating at only 70 per cent of this level, and this is resulting in an annual loss of $480 million. Its profit contribution per unit is 25 per cent. Haedoo has now set targets for its performance in two years’ time: it aims to reduce its capacity to 1.5 million units and operate at 80 per cent of this level; it aims to have a profit of $800 million; and in order to achieve its target output and sell it, it aims to keep its prices the same, while reducing its level of unit variable costs to 90 per cent of their current level by rationalizing its supply procedures and standardizing components.
a. Calculate the target average level of price for Haedoo.
b. Calculate the target level of unit variable costs.
c. Calculate the target level of break-even output.
Jun 30 2020 View more View Less
Preparation of soap, nail polish remover, alcohols, varnishes, shampoo, shampoo
Mar 25 2020= 1. Find the particular solution of the initial-value problem xưy' + xy = 1 for x > 0 and y(1) = 2 [5 points] 0 and y(1) = 2 [5 points]" aria-describedby="fak" />
May 07 2021Karla Gomez is the supervisor at the Grand Hotel s casual restaurant. Karles responsibilities include overseeing five servers and two bussers, seating guests, and taking ...
May 07 2020Find the APR, or stated rate, in each of the following cases (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places, e.g., 3...
Jul 30 2021I was told that there are presently 13 "hackers" on my IP address. How can that be?
Apr 27 2020Fresh Foods has sales of $213,600, total assets of $198,700, a debt-equity ratio of 1.43, and a profit margin of 4.8 percent. What is the equity multiplier?.30.431.932.432.30
Apr 05 2020The demand equation for a product is 2 q= for 0
Jun 06 2021A capital budgeting project is considered to be feasible if: a) the sum of future cash flows from the project is greater than the initial outlay. b) the sum of the presen...
Nov 28 2019The MoMi Corporationâs income before interest, depreciation and taxes, was $1.9 million in the year just ended, and it expects that this will grow by 5% per year foreve...
Jun 09 2021SI is considering investing in a new product named Z-90. There is a 50% chance that the product will be a success which then generates $110,000 cash inflow each year for ...
May 09 2020