Textbook Publishing ASW Publishing, Inc., a small publisher of college textbooks, must make a decision re- garding which books to publish next year. The books under consideration are listed in the following table, along with the projected three-year sales expected from each book: Book Subject Business calculus Finite mathematics Type of Book New Projected Sales (1000s) 20 Revision General statistics New 30 15 Mathematical statistics New 10 Business statistics Revision 25 Finance New 18 Financial accounting New 25 Managerial accounting Revision 50 English literature New 20 German New 30 The books listed as revisions are texts that ASW already has under contract; these texts are being considered for publication as new editions. The books that are listed as new have been reviewed by the company, but contracts have not yet been signed. Three individuals in the company can be assigned to these projects, all of whom have varying amounts of time available; John has 60 days available, and Susan and Monica both have 40 days available. The days required by each person to complete each project are shown in the following table. For instance, if the business calculus book is published, it will require 30 days of John's time and 40 days of Susan's time. An "X" indicates that the per- son will not be used on the project. Note that at least two staff members will be assigned to each project except the finance book. Case Problem 2 Yeager National Bank Book Subject Business calculus John Susan Monica 30 40 X Finite mathematics 16 24 X General statistics 24 X 30 Mathematical statistics 20 X 24 Business statistics 10 X 16 Finance X 14 Financial accounting X 24 26 Managerial accounting 28 30 English literature 34 30 German X 50 36 523 ASW will not publish more than two statistics books or more than one accounting text in a single year. In addition, management decided that one of the mathematics books (busi- ness calculus or finite math) must be published, but not both. Managerial Report Prepare a report for the managing editor of ASW that describes your findings and recom- mendations regarding the best publication strategy for next year. In carrying out your analy- sis, assume that the fixed costs and the sales revenues per unit are approximately equal for all books; management is interested primarily in maximizing the total unit sales volume. The managing editor also asked that you include recommendations regarding the fol- lowing possible changes: 1. If it would be advantageous to do so, Susan can be moved off another project to al- low her to work 12 more days. 2. If it would be advantageous to do so, Monica can also be made available for another 10 days. 3. If one or more of the revisions could be postponed for another year, should they be? Clearly the company will risk losing market share by postponing a revision. Include details of your analysis in an appendix to your report.

Textbook Publishing ASW Publishing, Inc., a small publisher of college textbooks, must make a decision re- garding which books to publish next year. The books under consideration are listed in the following table, along with the projected three-year sales expected from each book: Book Subject Business calculus Finite mathematics Type of Book New Projected Sales (1000s) 20 Revision General statistics New 30 15 Mathematical statistics New 10 Business statistics Revision 25 Finance New 18 Financial accounting New 25 Managerial accounting Revision 50 English literature New 20 German New 30 The books listed as revisions are texts that ASW already has under contract; these texts are being considered for publication as new editions. The books that are listed as new have been reviewed by the company, but contracts have not yet been signed. Three individuals in the company can be assigned to these projects, all of whom have varying amounts of time available; John has 60 days available, and Susan and Monica both have 40 days available. The days required by each person to complete each project are shown in the following table. For instance, if the business calculus book is published, it will require 30 days of John's time and 40 days of Susan's time. An "X" indicates that the per- son will not be used on the project. Note that at least two staff members will be assigned to each project except the finance book. Case Problem 2 Yeager National Bank Book Subject Business calculus John Susan Monica 30 40 X Finite mathematics 16 24 X General statistics 24 X 30 Mathematical statistics 20 X 24 Business statistics 10 X 16 Finance X 14 Financial accounting X 24 26 Managerial accounting 28 30 English literature 34 30 German X 50 36 523 ASW will not publish more than two statistics books or more than one accounting text in a single year. In addition, management decided that one of the mathematics books (busi- ness calculus or finite math) must be published, but not both. Managerial Report Prepare a report for the managing editor of ASW that describes your findings and recom- mendations regarding the best publication strategy for next year. In carrying out your analy- sis, assume that the fixed costs and the sales revenues per unit are approximately equal for all books; management is interested primarily in maximizing the total unit sales volume. The managing editor also asked that you include recommendations regarding the fol- lowing possible changes: 1. If it would be advantageous to do so, Susan can be moved off another project to al- low her to work 12 more days. 2. If it would be advantageous to do so, Monica can also be made available for another 10 days. 3. If one or more of the revisions could be postponed for another year, should they be? Clearly the company will risk losing market share by postponing a revision. Include details of your analysis in an appendix to your report.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter5: Business And Economic Forecasting

Section: Chapter Questions

Problem 1.1CE

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