Andrews Ceramics produces specialty ceramic products for multiple uses. The company is evaluating a proposal from a start-up company that is manufacturing micro generators. The start-up wishes to purchase a quantity of your Type D48 ceramic spools. You believe that micro generators could be a growth market in the future. Being an early supporter of the start-up business could allow for substantial future business for your company. Using regression analysis, determine the cost-estimating equation to manufacture Type D48 ceramic spools. Month Spools Produced Manufacturing Costs January 7,920 $12,416 February 10,571 $11,400 March 7,560 $8,526 April 10,875 $12,420 May 13,695 $17,221 June 12,150 $15,552 July 6,448 $12,760 August 9,801 $15,077 September 13,365 $15,675 October 12,672 $18,018 November 5,360 $10,032 December 8,276 $12,974 What is the lowest price that your company could accept without making the company worse off?

Andrews Ceramics produces specialty ceramic products for multiple uses. The company is evaluating a proposal from a start-up company that is manufacturing micro generators. The start-up wishes to purchase a quantity of your Type D48 ceramic spools. You believe that micro generators could be a growth market in the future. Being an early supporter of the start-up business could allow for substantial future business for your company. Using regression analysis, determine the cost-estimating equation to manufacture Type D48 ceramic spools. Month Spools Produced Manufacturing Costs January 7,920 $12,416 February 10,571 $11,400 March 7,560 $8,526 April 10,875 $12,420 May 13,695 $17,221 June 12,150 $15,552 July 6,448 $12,760 August 9,801 $15,077 September 13,365 $15,675 October 12,672 $18,018 November 5,360 $10,032 December 8,276 $12,974 What is the lowest price that your company could accept without making the company worse off?

Essentials of Business Analytics (MindTap Course List)

2nd Edition

ISBN:9781305627734

Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Chapter15: Decision Analysis

Section: Chapter Questions

Problem 2P: Southland Corporation’s decision to produce a new line of recreational products resulted in the need...

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The jarvis corporation produces bucket loader assemblies for the tractor industry. The product has a long term life expectancy. Jarvis has a traditional manufacturing and inventory system. Jarvis is considering the installation of a just-in-time inventory system to improve its cost structure. In doing a full study using its manufacturing engineering team as well as consulting with industry JIT experts and the main vendors and suppliers of the components Jarvis uses to manufacture the bucket loader assemblies, the following incremental cost-benefit relevant information is available for analysis: The Jarvis cost of investment capital hurdle rate is 15%. One time cost to rearrange the shop floor to create the manufacturing cell workstations is $275,000. One time cost to retrain the existing workforce for the JIT required skills is $60,000. Anticipated defect reduction is 40%. Currently there is a cost of quality defect assessment listed as $150,000 per year. The setup time for…