Almona, Inc. is your dad's company. It manufactures electrostatic generators for classroom demonstrations and has a capacity of 100,000 units per year. The fixed cost of the process is $150,000. If the generators sell for $70 each, what is the maximum variable cost per unit to break even when production is at 80% of capacity? The maximum variable cost is $ per unit.

Almona, Inc. is your dad's company. It manufactures electrostatic generators for classroom demonstrations and has a capacity of 100,000 units per year. The fixed cost of the process is $150,000. If the generators sell for $70 each, what is the maximum variable cost per unit to break even when production is at 80% of capacity? The maximum variable cost is $ per unit.

EBK HEALTH ECONOMICS AND POLICY

7th Edition

ISBN:9781337668279

Author:Henderson

Publisher:Henderson

Chapter4: Economic Evaluation In Health Care

Section: Chapter Questions

Problem 7QAP

See similar textbooks

Similar questions

Almona, Inc. is your dad’s company. It manufactures electrostatic generators for classroom demonstrations and has a capacity of 100,000 units per year. The fixed cost of the process is $150,000. If the generators sell for $90 each, what is the maximum variable cost per unit to break even when production is at 80% of capacity? The maximum variable cost is $ per unit.
Your car gets 29 miles per gallon (mpg) at 60 miles per hour (mph) and 25 mpg at 70 mph. At what speed should you make a 525-mile trip: (a) If gas costs $3 per gallon and your time is worth $18/hr? (b) If gas costs $4 per gallon and your time is worth $12/hr? (c) If gas costs $5 per gallon and your time is worth $9/hr? (d) Build a spreadsheet to calculate the total trip cost for gas costs of $2, $3, $4, and $5 and values of time of $6, $9, $12, $15, and $18 per hour. Do two tables: one at 60 mph and one at 70 mph.
The ABC Manufacturing Company incurs an annual fixed cost of $100,000 to maintain its production facilities. Additionally, the variable cost per unit produced is $10. If the company produces and sells 5,000 units in a year, what is the total annual cost?
For a motor to operate a pump, a design engineer must choose the horsepower. Horsepower rating is a design characteristic that can vary from 10 to 40 horsepower. The motor will cost $120 per year to operate, plus $0.60 per horsepower. The running expenses of such motors will be $0.055 per horsepower-hour divided by the horsepower rating. Each year, 9,000 horsepower-hours will be required. Determine how much horsepower should be supplied to keep the overall yearly cost to a minimal. Demonstrate that your entire cost each year has been reduced.
California Gardens, Inc., prewashes, shreds, and distributes a variety of salad mixes in 2-pound bags. Doug Voss, Operations VP, is considering a new Hi-Speed shredder to replace the old machine, referred to in the shop as "Clunker." Hi-Speed will have a fixed cost of $87,000 per month and a variable cost of $1.20 per bag. Clunker has a fixed cost of only $31,000 per month, but a variable cost of $1.70. Selling price is $2.40 per bag. Part 2 a) What is the crossover point in units (point of indifference) for the processes? The crossover point is 112000 units. (Round your response to the nearest whole number.) Part 3 b) What is the monthly profit or loss if the company changes to the Hi-Speed shredder and sells 90,000 bags per month? The monthly profit or loss if the company changes to the Hi-Speed shredder and sells 90,000 bags per month is $enter your response here. (Round your response to the nearest dollar and include a minus sign if necessary.)
The economic order quantity of Inc. is 1,000 unit. They sold their sole product for a selling price of P5. It takes P20,000 a year for Inc. in ordering 1,000 units per transaction. Carrying cost is P4 per unit per year. The lead time for this product is one week. How much sales revenue should Inc. have for this economic order quantity to be plausible? (Use 360 days a year)
A chemical engineer is considering two sizes of pipes for moving distillate from a refinery to the tank farm. A small pipeline will cost less to purchase (including valves and other appurtenances), but will have a high head loss and, therefore, a higher pumping cost. The small pipeline will cost $1.7 million installed and have an operating cost of $12,000 per month. A larger-diameter pipeline will cost $2.1 million installed, but its operating cost will be only $8000 per month. Which pipe size is more economical at an interest rate of 1% per month on the basis of an annual worth analysis? Assume the salvage value is 10% of the first cost for each pipeline at the end of the 10-year project.
Allina opens an exotic bakery. Her capacity for the month is eight hundred (800) Love Cherry Short cakes. On average, in a month, she pays a fixed amount for water, electricity, security and a loan of TTD100.00, TTD1,200.00, TTD2,700.00 and TTD4,000.00 respectively. In addition, she estimates that TTD50.00 more must be paid for each Love Cherry Short cake she makes and sells. If she sells one Love Cherry Short cake for TTD90.00. Identify and clearly state all variables used. Determine the following: Allina’s total cost and revenue functions. From part a) state the domain and range the total cost and revenue functions. Allina’s total cost when she produces and sells one thousand Love Cherry Short cakes. The value of the rational function of total cost and total revenue when no Love Cherry Short cakes are made and sold. Answer the following based on the problem set above. a. write a short reflective piece (NO MORE THAN 50 words per Problem Set…
Tom borrowed Php500,000 from her parents to open a spa. He pays her parents a 5% yearly return on the money they lent her. Her other yearly fixed costs equal Php150,000 and his variable costs equal Php200,000. In her first year, Tom had a total of 2,000 customers at a price of Php300/customer. Tom's total fixed cost is
Sales of bottled water in the United States totaled 34.0 gallons per person in 2014. Evian, a high-quality natural spring water, costs about 60¢ per bottle, while a local brand of purified municipal water may cost only 25¢ per bottle. On average, a local municipal water utility may provide drinkable tap water for $2.90 per 1000 gallons. If the average person drinks two bottles of water per day or uses 5 gallons per day to obtain the same amount of water from the tap, what are the present worth values per person for 1 year of drinking tap water versus bottled water using (a) Evian, and (b) local-brand bottled water? Use an interest rate of 6% per year, compounded monthly, and 30 days per month.
The Uniqlo, a retail company, sells a product at P400 per unit, selling all that is produced. Fixed cost is P250,000 and variable cost per unit is P200.
A furniture manufacturer has an annual overhead cost of P120,000 plus 20% of the sales in pesos. Labor costs P20 per set and the materials cost P10. He has a maximum capacity of 1000 sets per month but expects to produce only 8000 sets per year. If he could sell all what he expects to produce, how much is the selling price of each set just to break even? Show solutions.