1. (‘JJ) uses a certain machine to produce carjacks. The machine cost the company $90,000 three years ago. The reduced
s ago. The reduced book value now stands at $60,000. A new model of the machine is currently available for $139,350. The new machine has a useful life of five years, at which time it will be sold for $20,000. Using the new machine, the expected unit sales of the car jacks would be 6,000 car jacks per annum. The estimated unit selling price is $35 for the first year. As a result of the COVID-19 pandemic in Singapore, JJ is experiencing labour shortage. JJ will have to transfer workers from another department to the new project. These workers earn a contribution of $2 per direct labour hour in their original department. The fixed overhead cost would be $2.20 per hour and this is expected to remain unchanged. JJ’s products are being sold to a distributor. The sales agreement allows the selling price to rise at the rate of 10 percent per year after the first year. The unit cost price, except for fixed costs, is expected to increase at the same rate as the selling price. Working capital requirements are expected to be $15,000 in the first and second years, increasing to $18,000 in the third year and is expected to remain at this level till the end of the project. All the amounts of working capital will be recovered at the time of project termination. The new project uses cutting-edge technology and so enjoys a tax holiday from the authorities. The drawback of using this high-risk approach is that the new project requires a minimum return of 27 percent per annum. Required: Identify the relevant cash flows for the decision as to whether JJ should proceed to purchase the new machine. Note: To show all workings with accompanying explanations. Word count requirement: 800
2.You make very good pizzas, so you decide to sell your pizzas on campus. Since the set up for making
pizza is already available to you, the only cost involved is that of making the pizza, which you calculate to be $ 5 per pizza.
a. What is the cost function?
If 10 pizzas are available in a day, the market offers a price of $ 11 per pizza. If 50 pizzas are available in a day, the market offers a price of $ 7 per pizza.
b. Assuming a linear relationship between price and quantity, find the price that the market offers as a function of the number of pizzas available. You start selling the pizzas.
c. What is revenue as a function of the quantity you sell? What is the profit function?
d. What quantity will maximize your profit? Call it q ∗ 1. What is the maximum profit?
e. If somebody is already supplying 5 pizzas every day, What is the maximum profit that you can make?
3.Hello I have two problems to solve the subject is Quantitative Methods for Decision-Making
After graduating from AUD, Salman plans
After graduating from AUD, Salman plans to start a book publishing company in the Media City. He did some research and found that the printer will cost Dh 230,000. He estimated that the variable cost per book is Dh 170 and the selling price is Dh 390.
a. How many books must he sell to break even? Also calculate the breakeven in dirham.
b. In addition to the costs given above, if he wants to pay himself a salary of Dh 15,400 per year, what is her breakeven point in units and dirham?
c. In the first three months of his business, he sold 400 books. Suddenly the printer breaks down. He spent Dh 25000 to fix the printer. In addition to 400 books sold, how many more books she should sell to breakeven? Assume that this part of the question is independent, and she does not draw any salary.
A furniture store makes tables and chairs from plywood and glass. The store has 30 units of plywood, 24 units of glass. Each table requires 7 units of plywood three units of glass, whereas each chair requires three units of plywood and two units of glass. The demand for chairs is between 2 and 4. The ratio between the table and chair is at least 1 to 2. A table earns $225 in profit and a chair, $145. The store also wants a minimum profit of $5000. The store wants to determine the number of tables and chairs to make in order to maximize profit. Formulate a linear programming model for this problem
4.The supply for a particular item is given by the function
. Find the producer's surplus if the equilibrium
producer's surplus if the equilibrium price of a unit
.A retailer anticipates selling
units of its product at a uniform rate over the next year. Each time the retailer places an order for
units, it is charged a flat fee of
. Carrying costs are
per unit per year. How many times should the retailer reorder each year and what should be the lot size to minimize inventory costs? What is the minimum inventory cost?
For a particular commodity, the demand function is
.A hotel rents
rooms at a rate of
per day. For each
increase in the rate, three fewer rooms are rented. Find the room rate that maximizes daily revenue.
6.Question: We are selling a monthly service to a customer at $100. The deal margin at a selling price of
of $100 equals 20% . Included in the 20% margin is sales commission which equals 10% of the $100 , which is $10. If I decrease the commission to only 3% , $3 instead of the 10%, $10 , what will my new deal margin be?
After we cut the commission on the deal , we are also going to reduce our price to the customer by 6% . What does the 6% represent in terms of overall dollars on the $100 service and what would the deal commission be after this additional change to the financial structure of the deal?