HW chapter11

.xlsx

School

Benedictine University *

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Course

3301

Subject

Economics

Date

Apr 3, 2024

Type

xlsx

Pages

9

Uploaded by ChefDragonflyPerson749

Report
Modern Electronics a. Total Revenue = $ 705.12 Model Parameters for Qty Sold PRICE Constant Price A Price B b. A $ 18.00 20.00 -0.62 0.30 B $ 30.00 29.00 0.10 -0.60 NA=20-0.62PA+0.30PB NB=29+0.10PA- 17.84 12.8 2. Modern Electronics sells two popular models of wireless headphones, model A and model B. The sales of these products are not independent of each other (in economics, we call these substitutable prod- ucts because if the price of one increases, sales of the other will increase). The store wishes to establish a pricing policy to maximize revenue from these prod- ucts. A study of price and sales data shows the fol- lowing relationships between the quantity sold (N) and prices (P) of each model: NA = 20 - 0.62PA + 0.30PB NB = 29 + 0.10PA - 0.60PB a. Construct a mathematical model for the total revenue. b. What is the predicted revenue if PA = $18 and PB = $30?
QTY SOLD REVENUE TOTAL REV 17.84 $ 321.12 $ 705.12 12.80 $ 384.00 -0.60PB
MasterTech Net Sales $ 1,250,000.00 Cost of Sales $ 300,000.00 Gross Profit $ 950,000.00 Sales Expenses (fixed) $ 90,000.00 Sales Expenses (variable) $ 100,000.00 Percentage 8% Total Sales Expenses $ 190,000.00 Administrative Expenses $ 50,000.00 Net Operating Profit $ 710,000.00 Interest Expenses $ 8,000.00 Net Income Before Taxes $ 702,000.00 Taxes $ 351,000.00 Tax Rate 50% NET INCOME $ 351,000.00 20. MasterTech is a new software company that develops and markets productivity software for municipal government applications. In developing their income statement, the following formulas are used: gross profit = net sales - cost of sales net operating profit = gross profit - administrative expenses - selling expenses net income before taxes = net operating profit - interest expense net income = net income before taxes - taxes Net sales are expected to be $1,250,000. Cost of sales is estimated to be $300,000. Selling expenses have a fixed component that is estimated to be $90,000 and a variable component that is estimated to be 8% of net sales. Administrative expenses are $50,000. Interest expenses are $8,000. The company is taxed at a 50% rate. Develop a spreadsheet model to calcu- late the net income. Design your spreadsheet using good spreadsheet-engineering principles.
Garage Band Expected Crowd 2500 people Average Concessions Expenditure $ 25.00 per person Fixed Cost $ 18,000.00 Ticket Price $ 20.00 per person REVENUE FROM TICKETS $ 50,000.00 CONCESSION SALES $ 62,500.00 PROFIT PERCENTAGE 80% BAND PROFIT $ (17,100.00) 21. A garage band wants to hold a concert. The expected crowd is 2,500. The average expenditure on concessions is $25. Tickets sell for $20 each, and the band’s profit is 80% of the gate and concession sales minus a fixed cost of $18,000. Develop a mathematical model and implement it on a spreadsheet to find the band’s expected profit.
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