MAT540 Week 1
1. 1. The Retread Tire Company
recaps tires. The fixed annual cost of the recapping
operation is $55,000. The variable cost of recapping a tire
is $8. The company charges $21 to recap a tire.
a. For an annual volume
of 10,000 tires, determine the total cost, total revenue, and
profit.
b. Determine the annual
break-even volume for the Retread Tire Company operation.
2. 2. Evergreen Fertilizer
Company produces fertilizer. The company’s fixed monthly cost
is $30,000, and it’s variable cost per pound of fertilizer is
$0.16. Evergreen sells the fertilizer for $0.40 per pound.
Determine the monthly break-even volume for the company.
3. 3. If Evergreen Fertilizer
Company in Problem 2 changes the price of its fertilizer from $0.40
per pound to $0.60 per pound, what effect will the change have on
the break-even volume?
4. 4. If Evergreen Fertilizer
Company increases its advertising expenditures by $14,000 per year,
what effect will the increase have on the break-even volume
computed in Problem 2?
5. 5. Annie McCoy, a student at
Tech, plans to open a hot dog stand inside Tech’s football stadium
during home games. There are seven home games scheduled for
the upcoming season. She must pay the Tech athletic
department a vendor’s fee of $2,500 for the season. Her stand
and other equipment will cost her $3,100 for the season. She
estimates that each hot dog she sells will cost her $0.35. She has
talked to friends at other universities who sell hot dogs at
games. Based on their information and the athletic
department’s forecast that each game will sell out, she anticipates
that she will sell approximately 2,000 hot dogs during each game.
a. What price should she
charge for a hot dog in order to break even?
b. What factors might occur
during the season that would alter the volume sold and thus the
break-even price Annie might charge?
6. 6. The College of Business
at Kerouac University is planning to begin an online MBA
program. The initial start-up cost for computing equipment,
facilities, course development, and staff recruitment and
development is $360,000. The college plans to charge tuition
of $17,000 per student per year. However, the university
administration will charge the college $12,000 per student for the
first 100 students enrolled each year for administrative costs and
its share of tuition payments.
a. How many students does
the college need to enroll in the first year to break even?
b. If the college can enroll 75
students the first year, how much profit will it make?
c. The college believes
it can increase tuition to $22,000, but doing so would reduce
enrollment to 35. Should the college consider doing this?
7. 7. The following
probabilities for grades in management science have been determined
based on past records:
Grade
Probability
A
0.15
B
0.25
C
0.38
D
0.12
F
0.10
The grades are assigned on a 4.0 scale, where an A is a 4.0,
a B a 3.0, and so on. Determine the expected grade and
variance for the course.
8. 8. An investment firm is
considering two alternative investments, A and B, under two
possible future sets of economic conditions, good and poor.
There is a .60 probability of good economic conditions occurring
and a 0.40 probability of poor economic conditions occurring.
The expected gains and losses under each economic type of
conditions are shown in the following table:
Economic Conditions
Investment
Good
Poor
A
$350,000 -$350,000
B
$120,000 70,000
Using the expected value of each investment alternative, determine
which should be selected.
9. 9. The weight of bags of
fertilizer is normally distributed, with a mean of 50 pounds and a
standard deviation of 7 pounds. What is the probability that a bag
of fertilizer will weigh between 45 and 55 pounds?
10.
10. 20. The Polo Development Firm is building a shopping
center. It has informed renters that their rental spaces will
be ready for occupancy in 19 months. If the expected time
until the shopping center is completed is estimated to be 16
months, with a standard deviation of 4 months, what is the
probability that the renters will not be able to occupy in 19
months?
11. 11. The manager of the local National Video Store
sells videocassette recorders at discount prices. If the
store does not have a video recorder in stock when a customer wants
to buy one, it will lose the sale because the customer will
purchase a recorder from one of the many local competitors.
The problem is that the cost of renting warehouse space to keep
enough recorders in inventory to meet all demand is excessively
high. The manager has determined that if 90% of customer
demand for recorders can be met, then the combined cost of lost
sales and inventory will be minimized. The manager has
estimated that monthly demand for recorders is normally
distributed, with a mean of 180 recorders and a standard deviation
of 60. Determine the number of recorders the manager should
order each month to meet 90% customer demand.
Do you need a similar assignment done for you from scratch?
We have qualified writers to help you. We assure you an A+ quality
paper that is free from plagiarism. Order now for an Amazing
Discount! Use Discount Code “Newclient” for a 15% Discount!NB: We
do not resell papers. Upon ordering, we do an original paper
exclusively for you.
The post mat 540 2127207 2 appeared first on Essay Writers.
"Is this question part of your assignment? We Can Help!"
Other samples, services and questions:
When you use PaperHelp, you save one valuable — TIME
You can spend it for more important things than paper writing.
