(solution) Q5-9 A manager must decide how many machines of a certain type to

(solution) Q5-9 A manager must decide how many machines of a certain type to

Q5-9 A manager must decide how many machines of a certain type to purchase. Each machine can process 100 customers per day. One machine will result in a fixed cost of $2,200 per day, while two machines will result in a fixed cost of $4,000 per day. Variable costs will be $17 per customer, and revenue will be $45 per customer.

        

a. Determine the break-even point for each range. (Round your answers to the next whole number.)

     

  One machine   
  Two machines   

    
 

b.

If estimated demand is 90 to 120 customers per day, how many machines should be purchased?

   
  (Click to select)One machineTwo machines

Q5-1 A manufacturing shop is designed to operate most efficiently at an output of 1,050 units per day. In the past month the plant produced 810 units.

What was their capacity utilization rate last month? (Round your answer to 1 decimal place.)

  Capacity utilization rate  %  

Q5-6 A producer of felt-tip pens has received a forecast of demand of 36,000 pens for the coming month from its marketing department. Fixed costs of $26,000 per month are allocated to the felt-tip operation, and variable costs are 31 cents per pen.

     

b. At what price must pens be sold to obtain a monthly profit of $17,000, assuming that estimated demand materializes? (Round your answer to 2 decimal places. Omit the “$” sign in your response.)

    

  Price

$

Q5-7 A real estate agent is considering changing her cell phone plan. There are three plans to choose from, all of which involve a monthly service charge of $20. Plan A has a cost of $.37 a minute for daytime calls and $.16 a minute for evening calls. Plan B has a charge of $.46 a minute for daytime calls and $.14 a minute for evening calls. Plan C has a flat rate of $75 with 300 minutes of calls allowed per month and a charge of $.34 per minute beyond that, day or evening.

     
 

a

Determine the total charge under each plan for this case: 130 minutes of day calls and 50 minutes of evening calls in a month. (Do not round intermediate calculations.  Round your answer to 2 decimal places.  Omit the “$” sign in your response.)

      
 

  Cost for Plan A                                                                                                 $   
  Cost for Plan B                                                                                                 $   
  Cost for Plan C                                                                                                 $   

       

c

If the agent will use the service for daytime calls, over what range of call minutes will each plan be optimal? (Round each answer to the nearest whole number.Include the indifference point itself in each answer.)

    
 

  Plan A is optimal from zero to                    minutes. Plan C is optimal from                   minutes onward.  

   
 

d

Suppose that the agent expects both daytime and evening calls. At what point (i.e., percentage of total call minutes used for daytime calls) would she be indifferent between plans A and B? (Do not round intermediate calculations.  Enter your answer as a percentage rounded to 2 decimal places.  Omit the “%” sign in your response.)

   
 

  Point

                                                               percent daytime minutes  

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