The Decision Maker Is Sid Stevens

B. Will the supplier be able to meet our cost, quality, and product performance requirements?

In 1975, Pat Bennett made a life changing decision. His entrepreneurial spirit drove him to leave a stable career and convert his part-time engine reconditioning business into a full-time endeavor. He moved from a shack next to his trailer home to a small hut that he rented for one month. After renting the hut he moved to a stall in a service station. With neither a business name nor a business license, Pat had little control over parts and profit. When the opportunity came to rent a larger space from a garage owner Pat took it. Here his business continued to grow and there was a need for him to hire a helper. Although he was in the business of engine reconditioning, he hired a premed

He was still faced with the problem of raising close to $10 million on an equity base

What seems to be the main issue is actually getting to build the prototype. Without it, lot of potential investors turned it down. For venture capitals and future potential clients to show further interest, Shane needs to show them a working prototype. However the prototype itself requires an investment of $250,000, this has proven to be difficult to raise. Without the prototype no one is willing to invest in the business, and without the investment Shane is unable to build a prototype. He is stuck in a vicious cycle and needs to find a different way to raise capital for his prototype.

12) Suppose that we force the production of one unit of product A. The new objective function value will be

b) Why does a business that has profit $30,000 per year need a bank loan?

Myrtle McGee is a woman who uses serenity as a form of spiritual guidance through the use of dolls, candles, and other things alike. Myrtle wants to share her inner joy with the rest of her small town of Hasley. Myrtle has very little to no experience running a small business yet she still has a dream of opening a shop that sells peace and joy. Myrtles entire business rests in the hands of herself and her cousin “Moonglow” who also lacks several forms of entrepreneurial skills. These facts help lead to the conclusion of denying her business loan, and below I will explain why.

Without fund Evans may be forced to abandon the venture. And time is pressing against her. With a lot of personal funds already invested she has a limited window of time that she will have before she will not have enough money to sustain herself while the business grows to where she could take a salary

* He needed initial capital for investment, which he got from his long term friend Kaplan

Opportunities: Has formed a number of alliances with other organizations, Has big connections to provide funding,

Another issue was the finance from the conventional sources which were reluctant to invest. They would need at least £235,000 to add to their own invest of £45,000 to cover the costs and operational losses for 12 months period. But, if it works out, then they would at £1 million profit by year five. Despite their enthusiasm and impressive CVs, the business angels deterred by their lack of experience in this market sector. However, they managed to get an appointment with Maurice Pinto, a private investor, who agreed to invest £235,000 for a 20 percent share in the company.

Q.1) Compute the following quantities for the current production process as well as for Mike’s and Ike’s plans, assuming the plans are implemented as described in the case.

d) The opportunity cost should be calculated as the resource cost of producing the input.

There was another problem of setting up capital required by the company for starting the production.

initiative is to attract outside capital, given the lack of collateral and sufficient cash flows and the