Briefly describe the details of the fictitious business

Reference no: EM13218262

Assume that you have been hired as a managing consultant by a company to offer some advice that will help it make a decision as to whether it should shut down completely or continue its operations. It currently uses 100 workers to produce 6,000 units of output per month(working 20 days/month). The daily wage per worker is $70, and the price of the firm's output is $32. The cost of other variable inputs is $2000 per day. You are told that the firm's fixed cost is high enough so that the firm's total costs exceed its total revenue. The marginal cost of the last unit is $30.

1. Briefly describe the details of the fictitious business that you created for this assignment.

2. Evaluate the financial performance of the company using the information provided in the scenario. Consider all the key drivers of performance, such as company profit or loss for both the short term and long term and how each factor influences managerial decisions. Be sure to show the calculations that helped you reach your conclusions.

Reference no: EM13218262

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