Operations Management, Advanced Statistics

Assignment Help:
1.Sam Lucarelli, owner of Lucarelli Products, is evaluating whether to produce 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 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 Lucarelli to break even? Use both the graphical and algebraic approaches to get your answer.

b)Lucarelli forecasts sales of 10,000 units for the first year if the selling price is set at $14 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, Lucarelli forecasts the first-year sales would increase to 15,000 units. Which price 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:- Operations Management

Reliability theory, Reliability theory is the theory which attempts to det...

Reliability theory is the theory which attempts to determine the reliability of the complex system from knowledge of the reliabilities of the components. Interest might centre on

Conditional probability, Conditional probability : The probability that an ...

Conditional probability : The probability that an event occurs given the outcome of other event. Generally written, Pr(A|B). For instance, the probability of a person being color b

Counter arguments, Standardise the following arguments, which involve count...

Standardise the following arguments, which involve counter-arguments Some educators have argued that the increasing use of the internet by children and teenagers will have a be

Over dispersion, Over dispersion is the phenomenon which occurs when empir...

Over dispersion is the phenomenon which occurs when empirical variance in the data exceeds the nominal variance under some supposed model. Most often encountered when the modeling

Case-cohort study, Case-cohort study : The research design in epidemiology ...

Case-cohort study : The research design in epidemiology which involves the sampling of controls at the outset of the study that is to be compared with the cases from the cohort. Th

Factor scores, The values assigned to factors for the individual sample uni...

The values assigned to factors for the individual sample units in a factor analysis. The most common approach is "regression method". When the factors are seen as the random variab

Explain multicentre study, Multicentre study : The clinical trial conducte...

Multicentre study : The clinical trial conducted simultaneously in the number of participating hospitals, with all centres following an agreed-upon study of the protocol and with

Bubble plot, Bubble plot : A method or technique for displaying the observa...

Bubble plot : A method or technique for displaying the observations which involve three variable values. Two of the variables are used to make a scatter diagram and values of the t

Extrapolation, This process of estimating from a data set those values lyin...

This process of estimating from a data set those values lying beyond range of the data. In the regression analysis, for instance, a value of the response variable might be estimate

Continual reassessment method, Continual reassessment method: An approach ...

Continual reassessment method: An approach which applies Bayesian inference for determining the maximum tolerated dose in a phase I trial. The method starts by assuming a logistic

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