Reference no: EM132896958

Questions -

Q1. E-Solar computes the expected profit for 2021 from their plant in Spain, factoring in the range of plant production flexibility. The demand is estimated to be 120,000 with probability 0.6 and 80,000 with probability 0.4. The plant can produce between 90,000 (minimum production capacity) and 130,000 (maximum production capacity) panels a year while maintaining the same variable production cost of 50 Euro per panel. The panels are sold at 100 Euro per panel. What is the expected profit (in Euro)?

a. 5,200,000

b. 5,400,000

c. 4,800,000

d. 5,000,000

Q2. Suppose a firm selling a commodity product wants to implement value-based pricing, and price discrimination between customers is not possible. Then the (value based price) should be set at following level:

The price that reflects a fixed markup with respect to the product cost

The maximum price at which it is still unprofitable for each of the customers to procure the product

The mimumum price at which it is still unprofitable for each of the customers to procure the product

The maximum of prices at which customers could obtain the same product on their own.

Q3. Mr. Smith holds money in a bank account that earns 4% per year. His demand for cash is constant at $450 per month. Every time he goes to the bank, he incurs the inconvenience cost that he estimates to be $12 per trip. How much money should Mr. Smith withdraw every time he goes to the bank?

a. 2100

b. 1350

c. 900

d. 1800

Q4. Modular product design with interchangeable components

Generally has no implications for supply chain performance

Enables more frequent inventory turnover and replenishment

Has extremely limited applications

Complicates production process