Explain making and marketing the new product, Operation Management

Assignment Help:

Mary Williams, owner of Williams Products, is evaluating whether to introduce a new product line. After thinking through the production process and the costs of raw materials and new equipment. Williams estimates the variable costs of each unit produced and sold at $6 and the fixed costs per year at $60,000

a. If the selling price is set at $18 each, how many units must be produced and sold for Williams to break even? Use both graphic and algebraic approach to get your answer.

b. Williams forecasts sales of 10,000 units for the first year if the selling price is set at $14.00 each. What would be the total contribution to profits from this new product during the first year?

c. If the selling price is set at $12.50, Williams forecasts that first-year sales would increase to 15,000 units. Which pricing strategy ($14.00 or $12.50) would result in the greater total contribution to profits?

d. What other considerations would be crucial to the final decision about making and marketing the new product?


Related Discussions:- Explain making and marketing the new product

Explain evaluation or rewards systems a source of conflict, How are differe...

How are different evaluation or rewards systems a source of conflict?

Explain terminals and arrive at a message concentrator, Messages are transm...

Messages are transmitted from low speed terminals and arrive at a message concentrator at a Poisson rate of 600/hr. They are held in a buffer until a hi-speed trunk line is free to

Explain customization in manufacturing or services, Evaluate the statement:...

Evaluate the statement: "Special-purpose technology is a common way of offering increased customization in manufacturing or services without taking on additional labour costs." Cit

Explain exceed the amount invested in auto loans, A bank is attempting to d...

A bank is attempting to determine where its assets should be invested during the current year. At present, $500,000 is available for investment in bonds, home loans, auto loans, an

Why expected profit to be positive, A job shop receives an order for high p...

A job shop receives an order for high precision formed parts. The cost of producing each part is approximately $20,000. The customer requires that either 4 or 5 good parts be suppl

Proposed solutions to combat conflicts of interest, Three major solutions h...

Three major solutions have been proposed to combat the medical industry conflicts of interest detailed above in this paper. The first solution is embodied in the Physician Payments

Compute the operating characteristics of interest, An urn contains nine whi...

An urn contains nine white balls and 11 black balls. A ball is drawn and replaced. If the ball is white your opponent pays you 25 cents. If it is black you pay him 25 cents. You ha

Appropriate control limits for the data, A quality team at Milburn Textiles...

A quality team at Milburn Textiles has been charged with setting up control charts to monitor a key dyeing process that has been improved and now stable.  The ideal temperature for

Consider the one-period-ahead forecasts, Do NOT use Minitab for this proble...

Do NOT use Minitab for this problem; you may use Excel. Handy, Inc. produces a solar powered electronic calculator that has experienced the following monthly sales history for the

Technology which encourages user contributions, Technology which encourages...

Technology which encourages user contributions and interactivity is known as Web 2.0.

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd