Assume a class needs to pay all expenses. The instructor cost $3,000 with an additional administrator cost of $50 per student. Tuition is $600 per student for the course. What is the minimum number of students that need to sign up for the course to run? 2. If firm’s total revenue is $20 million, its fixed costs are $12 million, and its variable cost are $22 million what is its profit? Should the firm shut down or stay in business in the short run? Would the decision change if the Total Revenue was $30 million instead of $20? 3. As the firm’s output expands, explain why the ATC and AVC get closer together.
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1. Assume a class needs to pay all expenses. The instructor cost $3,000 with an additional administrator cost of $50 per student. Tuition is $600 per student for the course. What is the minimum number of students that need to sign up for the course to run?
2.
If firm’s total revenue is $20 million, its fixed costs are $12 million, and its variable cost are $22 million what is its profit? Should the firm shut down or stay in business in the short run? Would the decision change if the Total Revenue was $30 million instead of $20?
3.
As the firm’s output expands, explain why the
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- NEED ASAP WITH COMPLETE SOLUTION! A particular university was considering whether to offer a seminar for executives. The tuition would be USD 650 per person. Variable costs, including meals, parking, and materials, would be USD 80 per person. Certain costs offering the seminarIncluding advertising, instructors' fees, room rent, audiovisual equipment rent would not be affected by the number of people attending Such costs. which could be thought of as fixed costs amounted to USD 8,000 for the seminar. If the university wants to have a profit of USD 7,000, how much revenue should they expect? a) $17,105.26 b)$ 17.108.27 c) none of these1. A recently retired professor, Melinda Marketing, plans to establish the Hot-Air FanCompany and manufacture circulating fans. She estimates the fixed cost of operations tobe $357,500 annually. The variable cost of producing the fans is forecasted to be $85 perunit.a. How many fans must be sold to break even if the fans are priced at $150?b. If Hot-Air sells 6,000 fans, what will be the EBIT?c. If Hot-Air sells 6,000 fans and has interest expense of $8,125, what is Hot-Air’stimes-interest-earned? Hot-Air does not have any nonoperating expenses.d. If the fans are priced at $150, what is Hot-Air’s breakeven sales? 2. Vapor Lock Motors’ EBIT is $7,000,000, the company’s interest expense is $2,000,000, and its tax rate is 40 percent. Vapor Lock’s beta is 1.5. a. What is Vapor Lock’s DFL? b. If Vapor Lock were able to grow its EBIT by 50%, what would be the percentage increase in net income? c. If Vapor Lock were able to grow its EBIT by 50%, what would be the resulting net income? 3. A…At Stardust Gems, a faux gem and jewelry company, the setting department is a bottleneck. The company is considering hiring an extra worker, whose salary will be $67,000 per year, to ease the problem. Using the extra worker, the company will be able to produce and sell 9,000 more units per year. The selling price per unit is $20. The cost per unit currently is $15.85 as shown: What is the annual financial impact of hiring the extra worker for the bottleneck process?
- 21. Ortega Interiors provides design services to residential and commercial clients. The residential services produce a contribution margin of P450,000 and have traceable fixed operating costs of P480,000. Management is studying whether to drop the residential operation. If closed, the fixed operating costs will fall by P370,000 and Ortega's net income will increase or (decrease) by?To be profitable, a firm must recover its costs. These costs include both its fixed and its variable costs. One way that a firm evaluates at what stage it would recover the invested costs is to calculate how many units or how much in dollar sales is necessary for the firm to earn a profit. Consider the case of Blue Mouse Manufacturers: Blue Mouse Manufacturers is considering a project that will have fixed costs of $10,000,000. The product will be sold for $37.50 per unit, and will incur a variable cost of $11.25 per unit. Given Blue Mouse’s cost structure, it will have to sell units to break even on this project (QBEQBE).Pet Hotel, Inc. operates three luxury pet boarding facilities and expects the following results for the coming year. {picture} Answer each of the following questions independently. 1. Fixed costs are all allocated and unavoidable. What will happen to profit if Pet Hotel discontinues operations at Pet Spa? 2. Suppose now that $25,000 of the fixed costs shown for Pet Spa is avoidable. What will happen to total profits if Pet Hotel discontinues operations at Pet Spa?
- To be profitable, a firm must recover its costs. These costs include both its fixed and its variable costs. One way that a firm evaluates at what stage it would recover the invested costs is to calculate how many units or how much in dollar sales is necessary for the firm to earn a profit. Consider the case of Blue Mouse Manufacturers: Blue Mouse Manufacturers is considering a project that will have fixed costs of $10,000,000. The product will be sold for $32.50 per unit, and will incur a variable cost of $11.25 per unit. Given Blue Mouse’s cost structure, it will have to sell units to break even on this project (QBEQBE). Blue Mouse Manufacturers’s marketing sales director doesn’t think that the market for the firm’s goods is big enough to sell enough units to make the company’s target operating profit of $25,000,000. In fact, she believes that the firm will be able to sell only about 150,000 units. However, she also thinks the demand for Blue Mouse Manufacturers’s…Your company wants to decide between Investment A, which will cost $100K upfront, and Investment B, which will cost $150K upfront. If the economy performs well, Investment A will bring in $750K for your company, but if the economy performs poorly, then it will lose $250K for your company. If the economy performs well, Investment B will bring in $850K for your company, but if the economy performs poorly, then it will lose $300K for your company. There’s a 60% chance of a strong market and a 40% chance of a weak market. Assuming your company is risk-neutral, which option should you choose?Suppose ABC Corp’s break-even point is revenues of $1,100,000. Fixed costs are $660,000 a. Calculate the contribution margin percentage. b. Calculate the selling price if variable costs are $16 per unit. c. Suppose 75 000 units are sold. Calculate the profit earned. d. Will the company be profitable if able to sell 30,000 units? Explain. c. What should the company do to increase its profit above break-even point?
- Hey, I need some help in Business Analytics. I have no idea what I am doing, here is the problem. The manager of a small firm is considering whether to produce a new product that would require leasing some special equipment at a cost of $20,000 per month. In addition to this leasing cost, a production cost of $10 would be incurred for each unit of the product produced. Each unit sold would generate $20 in revenue. Develop a mathematical expression for the monthly profit that would be generated by this product in terms of the number of units produced and sold per month. Then determine how large this number needs to be each month to make it profitable to produce the product.G A company that has a definite plan for expansion will need to hire and train 60 new engineers per year. The cost of running a training program is $20,000, independent of he number of trainees. These engineers earn annual salaries of $30,000, so the com- pany prefers not to hire and train them before they are needed. On the other hand, they must be available when they are needed; and since it costs so much to train them, hey will be trained in advance of the time they are needed and in groups. They receive full salary while in the pool of trained, but not yet needed, engineers. What should the training-group size be, how often will the six-week training sessions be held, and how much will this program cost the company?43) A recently retired professor, Melinda Marketing, plans to establish the Hot-Air Fan Company and manufacture circulating fans. She estimates the fixed cost of operations to be $357,500 annually. The variable cost of producing the fans is forecasted to be $85 per unit. a. How many fans must be sold to break even if the fans are priced at $150? b. If Hot-Air sells 6,000 fans, what will be the EBIT? c. If Hot-Air sells 6,000 fans and has interest expense of $8,125, what is Hot-Air’s times-interest-earned? Hot-Air does not have any nonoperating expenses. d. If the fans are priced at $150, what is Hot-Air’s breakeven sales?