Khaled has developed a new technology device that is so exciting he is considering quitting his job in order to produce and market it on a large scale basis. Khaled will rent a small factory for 2,000dhs per month for production purposes. Utilities will cost 500dhs per month. Khaled has already taken an industrial design course at Dubal Men's College to help prepare for this venture. The course cost 800dhs. Khaled will rent production equipment at a monthly cost of 4,000dhs. He estimates the material cost per unit will be 20dhs, and the labor cost will be 10dhs per unit. He will hire workers and spend his time promoting the product. To do this he will quit his job which pays 20,000dhs per month. Advertising and promotion will cost 3,500dhs per month. Required: 1- 2. Calculate the total Fixed cost 3- Calculate the total variable cost per unit 30 4- If the machine max production capacity is 100o units per month, what is the selling price he should set to break even monthly 5- If Khaled to earn a profit equal to his current salary, for how much he should sell the unit 6- What is the fixed cost per unit for maximum production

Khaled has developed a new technology device that is so exciting he is considering quitting his job in order to produce and market it on a large scale basis. Khaled will rent a small factory for 2,000dhs per month for production purposes. Utilities will cost 500dhs per month. Khaled has already taken an industrial design course at Dubal Men's College to help prepare for this venture. The course cost 800dhs. Khaled will rent production equipment at a monthly cost of 4,000dhs. He estimates the material cost per unit will be 20dhs, and the labor cost will be 10dhs per unit. He will hire workers and spend his time promoting the product. To do this he will quit his job which pays 20,000dhs per month. Advertising and promotion will cost 3,500dhs per month. Required: 1- 2. Calculate the total Fixed cost 3- Calculate the total variable cost per unit 30 4- If the machine max production capacity is 100o units per month, what is the selling price he should set to break even monthly 5- If Khaled to earn a profit equal to his current salary, for how much he should sell the unit 6- What is the fixed cost per unit for maximum production

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Please answer it with clean and complete solution. Thank you.
The table below shows cost data for WipeOutSki Company, which manufactures skis for beginners. If the company’s fixed costs are $30, what is the marginal cost X? Quantity Variable Cost Fixed Cost Total Cost Average Variable Cost Average Total Cost Marginal Cost 0 0 $30 1 $10 $30 2 $25 $30 X 3 $45 $30 4 $70 $30 5 $100 $30 6 $135 $30 Group of answer choices $15 $55 $5
Diane's Donuts will begin selling donuts next week. Diane figures that the average variable cost to make each donut will be $0.25. She has paid $20,000 for the donut-making machinery and one year's rent. Refer to Situation 22-1. What will Diane's total variable costs be if she sells 34,500 donuts in one year? $10,950 $9,450 $8,625 $12,500 0 O
You inherited your father's concrete company which typically pours slab foundations for single family homes. You are trying to get a handle on the cost and revenue structure of the business. Your fixed cost per pour is $3,500, and variable costs include the price you pay for concrete aggregate mix plus $2.50 other variable costs per cubic yard. Although your cost structure includes fixed and variable costs, customers don't like such complicated math so you have decided to just charge $75 per cubic yard of concrete poured. One source of concrete aggregate material, which has 25% sand and 75% coarse aggregate, sells for $3 per cubic yard. Another source, which has 40% sand and 60% coarse aggregate, sells for $4.40 per cubic yard. A concrete aggregate mix must contain at least 31% sand by volume for proper batching. 1. Determine the least cost per cubic yard of blended aggregates. To do this, write an equation for the sand balance and solve. 2. Write a cost function that is a function…
What is the average variable cost of washing 90 cars? is the answer 4 or .7?
We have looked at different methods for calculating the cost of meals (food cost + production cost + etc.) and for setting the selling price of meals. Choose and operating context (e.g. restaurant, caterer, LTC, etc.) and discuss which methods for calculating meal costs and selling price are more appropriate for the chose context. Provide justification for your post.
Kanye runs a musical dinner theater. Last year, he earned 50000 in revenue and had explicit cost of 20000. Kanye could have made 29750 selling video games on the internet and received an additional 10000 if he rented out the store and equipment. Calculate kanyes implicit costs.
The Mini-Case "Economies of Scale at Google describes economies of scale for Google Cloud Storage. The cost function for this service is well-approximated by K C(q)-F+cq where C is total cost, F is fixed cost, c is a constant and q is output. What is marginal cost for this cost function? What are the average fixed cost, average variable cost, and average cost? Over what range of output does Google have economies of scale? The marginal cost function (MC) is The average fixed cost function (AFC) is AFC- The average variable cost function (AVC) is AVC- MC-C The average cost function (AC) is AC- (Property format your expressions using the tools in the palette. Hover over tools to see keyboard shortcuts. Eg, a fraction can be created with the character) Time Remaining: 02.09.09
Chris P. Nugget runs a small fast-food chicken restaurant named "Poultrygeist.". He hires one employee at a cost of $28,000 per year, pays annual rent of $25,000 for his shop, and spends $75,000 per year on other inputs (food, supplies, etc.). He has $100,000 of his own funds previously invested in equipment (ovens, serving counters, etc.) that could earn him $8,000 per year if these funds were alternatively invested. Chris has been offered $80,000 per year to work as a restaurant manager for a competitor. Total annual revenue from the restaurant is $200,000. For all answers, be specific and show your work. a. How much are Mr. Nugget's "explicit costs" this year? b. How much are Mr. Nugget's "implicit costs" this year? c. What is Mr. Nugget's "accounting profit" this year? d. What is Mr. Nugget's "economic profit" this year? e. Put into words what your answer to part d. means for Mr. Nugget's decision about whether to stay at his restaurant or to close and take the offer at his…
Joe quits his computer programming job, where he was earning a salary of $70,000 per year, to start his own computer software business in a building that he owns and was previously renting out for $20,000 per year. In his first year of business he has the following expenses: salary paid to himself, $45,000; rent, $0; and other expenses, $40,000. Find the accounting cost and the economic cost associated with Joe's computer software business. (Enter numeric responses using an integer.) The accounting cost of Joe's business is $ (Enter your response as an integer.) es Get more help Clear all Check answer
After running a successful pineapple business, Diddy looks for a new business venture. Now he wants to run gold mining business named "Diddy Bling Bling" which produces/sells raw gold. For simplicity, two types of inputs are required to produce raw gold (workers and gold mine). In short- run production, the size of gold mine is fixed while the number or workers can vary. After consulting his business consultant, Diddy computes the following cost table. The quantity of raw gold (kilograms) Averaged Total Cost (gold mine size=small) Averaged Total Cost (gold mine size-medium) Averaged Total Cost (gold mine size-Large) 1 700 1400 1800 2 600 1300 1700 3 500 1200 1600 4 400 1100 1500 5 300 1000 1400 6 400 900 1300 7 500 800 1200 8 610 600 1100 9 700 500 1000 10 800 400 900 11 900 375 800 12 1100 250 700 13 1200 400 600 14 1300 490 500 15 1400 600 400 16 1500 700 350 17 1600 800 300 18 1700 900 350 19 1800 1000 400 20 1900 1100 500 21 2000 1200 600 22 2100 1300 700 Draw Diddy Bling Bling's…
None