World Satellite Telephone Exchange Project NSDC has a contract to produce eight satellites to support a worldwide telephone system (for Alaska Telecom, Inc.) that allows individuals to use a single, portable telephone in any location on earth to call in and out. NSDC will develop and produce the eight units. NSDC has estimated that the R&D costs will be NOK (Norwegian Krone) 12,000,000. Material costs are expected to be NOK 6,000,000. They have estimated that the design and production of the first satellite will require 100,000 labor hours, and an 80 percent improvement curve is expected. Skilled labor cost is NOK 300 per hour. Desired profit for all projects is 25 percent of total costs. HOW many favor not C. What price would you ask for the project? Why? D. Midway through the project your design and production neonle Vill you quot alread Refer to exercise A5.1(C). Assume that 85% improvement curve is expected. The price asked for the project is approximately (choose the best answer): Note: You must also submit detailed solution for this question. A between NOK 175 million - NOK 200 million B between NOK 200 million - NOK 225 million D between NOK 150 million - NOK 175 million Less than NOK 150 million OR more than NOK 225 million
World Satellite Telephone Exchange Project NSDC has a contract to produce eight satellites to support a worldwide telephone system (for Alaska Telecom, Inc.) that allows individuals to use a single, portable telephone in any location on earth to call in and out. NSDC will develop and produce the eight units. NSDC has estimated that the R&D costs will be NOK (Norwegian Krone) 12,000,000. Material costs are expected to be NOK 6,000,000. They have estimated that the design and production of the first satellite will require 100,000 labor hours, and an 80 percent improvement curve is expected. Skilled labor cost is NOK 300 per hour. Desired profit for all projects is 25 percent of total costs. HOW many favor not C. What price would you ask for the project? Why? D. Midway through the project your design and production neonle Vill you quot alread Refer to exercise A5.1(C). Assume that 85% improvement curve is expected. The price asked for the project is approximately (choose the best answer): Note: You must also submit detailed solution for this question. A between NOK 175 million - NOK 200 million B between NOK 200 million - NOK 225 million D between NOK 150 million - NOK 175 million Less than NOK 150 million OR more than NOK 225 million
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
Section: Chapter Questions
Problem 1CE
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Transcribed Image Text:World Satellite Telephone Exchange Project
NSDC has a contract to produce eight satellites to support a worldwide
telephone system (for Alaska Telecom, Inc.) that allows individuals to use a
single, portable telephone in any location on earth to call in and out. NSDC
will develop and produce the eight units. NSDC has estimated that the R&D
costs will be NOK (Norwegian Krone) 12,000,000. Material costs are
expected to be NOK 6,000,000. They have estimated that the design and
production of the first satellite will require 100,000 labor hours, and an 80
percent improvement curve is expected. Skilled labor cost is NOK 300 per
hour. Desired profit for all projects is 25 percent of total costs.
HOW many favor not
C. What price would you ask for the project? Why?
D. Midway through the project your design and production neonle
Vill you quot
alread
Transcribed Image Text:Refer to exercise A5.1(C). Assume that 85% improvement curve is expected. The price asked for the project
is approximately (choose the best answer):
Note: You must also submit detailed solution for this question.
A
between NOK 175 million - NOK 200 million
B
between NOK 200 million - NOK 225 million
D
between NOK 150 million - NOK 175 million
Less than NOK 150 million OR more than NOK 225 million
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