Klee Motors is a small car leadership. On average, it sells a car for $24 000, which it purchases from their manufacturer for $20 000. Each month, Klee Motors pay $60 000 in rent and utilities and $60 000 in sales people's salaries. In addition to their salaries, sales people are paid a commission of $500 for each car they sell. Klee Motor also spends $15 000 each month on local advertisements. How many cars must Klee Motors sell each month to break even? Will Klee Motors earn a profit if it can sell 6 cars? How much sales revenue shall the company earn to achieve a $100 000 profit?

Klee Motors is a small car leadership. On average, it sells a car for $24 000, which it purchases from their manufacturer for $20 000. Each month, Klee Motors pay $60 000 in rent and utilities and $60 000 in sales people's salaries. In addition to their salaries, sales people are paid a commission of $500 for each car they sell. Klee Motor also spends $15 000 each month on local advertisements. How many cars must Klee Motors sell each month to break even? Will Klee Motors earn a profit if it can sell 6 cars? How much sales revenue shall the company earn to achieve a $100 000 profit?

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter5: Investment Decisions: Look Ahead And Reason Back

Section: Chapter Questions

Problem 5.5IP

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For Questions 13 and 14, Consider that Kim is a Nurse at a hospital in Atlanta and in 2010 she made an annual salary of $30,000. She has gotten several performance raises and one promotion over the years and in 2019 she earned $46,000 for the year. The Price Index representing her buying power in 2010 was 100 and in 2019 it is 164. It is now 2020 and Kim decided to keep working at that hospital and has worked another year and gotten a raise and another promotion and now her salary is $54,000 per year and the 2020 price index is now 171. NOW, what is the approximate value of her buying power now expressed in 2010 dollars? Question 14 options: $32,927 $26,900 $29,466 $31,579
G.R. Dry Foods Distributors specializes in the wholesale distribution of dry goods, such as rice and dry beans. The firm’s manager is concerned about an article he read in this morning’s The Wall Street Journal indicating that the incomes of individuals in the lowest income bracket are expected to increase by 10 percent over the next year. While the manager is pleased to see this group of individuals doing well, he is concerned about the impact this will have on G.R. Dry Foods.What do you think is likely to happen to the price of the products G.R. Dry Foods sells? Why? The price will increase, because dry beans and rice are normal goods. The price will increase, because dry beans and rice are inferior goods. The price will decrease, because dry beans and rice are inferior goods. The price will decrease, because dry beans and rice are normal goods.
Managerial Economics Suppose that a sales force has found 20 qualified buyers and has begun the sales process. The sales manager estimates that 10% eventually proceeds to make a purchase. Assume that a professional company offers three services, priced at $2,000, $7,000 and $20,000, respectively. Based on past results or the sales manager’s estimates, you project that 60% of first-time buyers will choose the cheapest option, 30% will choose the middle option and 10% will choose the most expensive option. a. Calculate the size of a likely sale for any prospect that makes a purchase.
Managerial Economics Suppose that a sales force has found 20 qualified buyers and has begun the sales process. The sales manager estimates that 10% eventually proceeds to make a purchase. Assume that a professional company offers three services, priced at $2,000, $7,000 and $20,000, respectively. Based on past results or the sales manager’s estimates, you project that 60% of first-time buyers will choose the cheapest option, 30% will choose the middle option and 10% will choose the most expensive option. a. How many qualified buyers must be found in order for the company to generate $80,000 in sales in a given period? Your final answer must be rounded to the nearest whole number.
The city of New Orleans has 200 advertising companies, 199 of which employ designers of normal ability at a salary of $100,000 a year. The companies that employ normal designers each collect $500,000 in revenue a year, which is just enough to ensure that each earns exactly a normal profit. The 200th company, however, employs Janus, an unusually talented designer. Because of Janus's talent, this company collects $1,000,000 in revenue a year. a. How much will Janus earn? Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Last year, Jarod left a job that pays $80,000 to run his own bike-repair shop. Jarod’s shop charges $65 for a repair, and last year the shop performed 4,000 repairs. Jarod’s production costs for the year included rent, wages, and equipment. Jarod spent $60,000 on rent and $120,000 on wages for his employees. Jarod keeps whatever profit the shop earns, but does not pay himself an official wage. Jarod used $25,000 of his savings to buy a machine for the business. His savings were earning an annual interest rate of 6 percent. 1. What is Jarod’s annual accounting profit? What is Jarod’s annual economic profit?
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Lucy and Lincoln are salespeople working for the same company with equal skills, ability, and experience. Both are paid a small base salary but the majority of their compensation is in the form of a commission, which is a percentage of the sales they make. Lucy earns more each year than Lincoln. What can you conclude about Lucy and Lincoln.
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