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Calculate the unit cost growth rate

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Reference no: EM132702556

Nicholas Nickelby, a quality control supervisor for Vinyl Windows, Inc., is concerned about an increase in distribution costs per unit from $10 to $13.80 over the last four years. Nickelby feels that setting up a new direct-sales distribution network at a cost of $17.50 per unit may soon be desirable.

-Calculate the unit cost growth rate using the constant rate of change model with continuous compounding.

-Forecast when unit distribution costs will exceed the current cost of direct-sales distribution.

Reference no: EM132702556

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