Concept explainers
Case summary:
Person G has planned to engage in wine making in his land. However, it requires more capital and experience. Hence, Person G initially decided to use $10,000 to finance the initial purchase of graphs for two year. He planned to make two types of wine that include Petite Sirah and Sauvignon Blanc. In the first year, Petite Sirah and Sauvignon Blanc requires $0.80 and $0.70 worth of grapes.
In the second year, $0.75 and $0.85 would be the cost of the grapes per bottle. In first year, the selling price of Petite Sirah would be $8.00 and Sauvignon Blanc would be $7.00. It will be $8.25 and $7.00 in the second year. The initial funds for the advertising will be $10,000 savings.
To develop: The spreadsheet model to decide the number of grapes to buy, money spend on advertising, number of bottles to sell, and the amount of profit.
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Practical Management Science, Loose-leaf Version
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