QUESTION 1 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 wil cost 500dhs per month. Khaled has already taken an industrial design course at Dubai 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 hs 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 4 If the machine max production capacity is 1000 units per month, what is the selling price he should set to break even monthly? 5 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? What is the total variable cost for maximum production B-f Khalid set the selling price for 70DHS on max production and managed to reduce the total foced cost by 2% what is the profit increase percentage If Khalid set the selling price for 700HS on max production and managed to reduce the total variable cost by 2% what is the profit increase percentage

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Comparative Advantage and Absolute Advantage Analysis

The theory of absolute advantage was given by Adam Smith in the year 1776.