Problem #4 - The mean number of air conditioning units assembled per month by Freeze, Inc. is 750 and the standard deviation is 100 units. a. If the number of air conditioning units assembled per month follows a normal distribution, calculate the probability of Freeze, Inc. to assemble a quantity of air conditioning units greater than the monthly break-even point calculated in problem 3-a. An improved assembling process is proposed to Freeze, Inc. to reduce the variable cost from $500 per unit to $400 per unit., increase the mean number of air conditioning units assembled per month from 750 to 850 and reduce the standard deviation to 90 units. As a result of the improvements, monthly fixed costs would go up from $250,000 to $300,000. Once these improvements are implemented, calculate the new number of air conditioning units that Freeze Inc. must sell every month to break-even, discuss and justify if you would recommend the process b.
Problem #4 - The mean number of air conditioning units assembled per month by Freeze, Inc. is 750 and the standard deviation is 100 units. a. If the number of air conditioning units assembled per month follows a normal distribution, calculate the probability of Freeze, Inc. to assemble a quantity of air conditioning units greater than the monthly break-even point calculated in problem 3-a. An improved assembling process is proposed to Freeze, Inc. to reduce the variable cost from $500 per unit to $400 per unit., increase the mean number of air conditioning units assembled per month from 750 to 850 and reduce the standard deviation to 90 units. As a result of the improvements, monthly fixed costs would go up from $250,000 to $300,000. Once these improvements are implemented, calculate the new number of air conditioning units that Freeze Inc. must sell every month to break-even, discuss and justify if you would recommend the process b.
Glencoe Algebra 1, Student Edition, 9780079039897, 0079039898, 2018
18th Edition
ISBN:9780079039897
Author:Carter
Publisher:Carter
Chapter10: Statistics
Section10.1: Measures Of Center
Problem 4GP
Related questions
Question
A, B, C please. Included is my answer for 3A

Transcribed Image Text:Problem #4 - The mean number of air conditioning units assembled per month by Freeze, Inc. is 750 and the standard
deviation is 100 units.
If the number of air conditioning units assembled per month follows a normal distribution, calculate the
a.
probability of Freeze, Inc. to assemble a quantity of air conditioning units greater than the monthly break-even point
calculated in problem 3-a.
b.
An improved assembling process is proposed to Freeze, Inc. to reduce the variable cost from $500 per
unit to $400 per unit., increase the mean number of air conditioning units assembled per month from 750 to 850 and
reduce the standard deviation to 90 units. As a result of the improvements, monthly fixed costs would go up from
$250,000 to $300,000. Once these improvements are implemented, calculate the new number of air conditioning
units that Freeze Inc. must sell every month to break-even, discuss and justify if you would recommend the process
improvement initiative.
с.
If the number of air conditioning units assembled per month still follows a normal distribution after the
implementation of the improvements described on item (b), calculate the probability of Freeze, Inc. to assemble a
quantity of air conditioning units greater than the new monthly break-even point. Now that you know this probability,
would you change your recommendation? Justify.
Discussion Question #1
- Using your "own words", discuss the differences among decision making under
certainty, decision making under risk, and decision making under uncertainty. Provide an example for each one of them.
Discussion Question #2
- Using your "own words", discuss how the coefficient of determination and the
coefficient of correlation are related and how would you use them in regression analysis.

Transcribed Image Text:Problem #3:
Rnow that at break-even, revenue must be equat
to cost.
Here we have a variable cost of $5004a manthiy
Fixed Cost of sa50, 0O
A:)/owe
can represent it as a Function C(x)-560X+250,000,
we
where x is the 'number of units sold.
we aiso know they sell eacah unit at lo00,30 revenue
funtion RY)=1000x
At break even point, total revenue
lo00X=500X+250,000
total cost
solving we get,
500x= 250,000
%3D
X=200,000/500 =500
3o Freeze Inc. must sell S00 unito per month to meet
break-eURn conditions.
Expert Solution

This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps

Recommended textbooks for you

Glencoe Algebra 1, Student Edition, 9780079039897…
Algebra
ISBN:
9780079039897
Author:
Carter
Publisher:
McGraw Hill

Glencoe Algebra 1, Student Edition, 9780079039897…
Algebra
ISBN:
9780079039897
Author:
Carter
Publisher:
McGraw Hill