Answer:
Visualize and organize your thoughts.
Explanation:
Answer:
$1905
Explanation:
Here we will have to calculate Economic Order Quantity to lower the ordering ordering and holding cost as much as we can. So here we will use the following formula to calculate the best number of units that we should order, which is as under:
Economic Order Quantity = SquareRoot (2 * Annual Demand * ordering cost per order / Holding cost per unit per year)
Here
Annual Demand = 900kg of palm oil per day * 52 weeks * 5 day a week / 7
Annual Demand = 900 * 52 * 5 / 7 = 33,429
And
Ordering cost per order = $57 per order
Annual holding cost per unit per year is 20% of $5.25 per kg which is $1.05.
So by putting values, we have:
Economic Order Quantity = Square Root (2 * 33,429 * 57 / 1.05)
Economic Order Quantity = 1905 kgs
The cost of underestimating the demand is considered a revenue loss that arises due to cancellation of flight costing $134. Hence, cost of underetimating the demand is
![C_u=\$134](https://tex.z-dn.net/?f=C_u%3D%5C%24134)
.
The cost of overestimating the demand is known as rewards. For example, free round trip ticket worth $263. Hence, the cost of overestimating the demand is
![C_o=\$263](https://tex.z-dn.net/?f=C_o%3D%5C%24263)
.
![\frac{C_u}{C_u+C_o} = \frac{134}{134+263} \\ \\ = \frac{134}{397} =0.3375](https://tex.z-dn.net/?f=%20%5Cfrac%7BC_u%7D%7BC_u%2BC_o%7D%20%3D%20%5Cfrac%7B134%7D%7B134%2B263%7D%20%20%5C%5C%20%20%5C%5C%20%3D%20%5Cfrac%7B134%7D%7B397%7D%20%3D0.3375)
The z-score that yields a p-value of 0.3375 is -0.4193.
Thus, super discount airlines should overbook the flight by 35 + (-0.4193 x 24) = 35 - 10.0632 = 24.9368 = 25 seats.
Therefore, super discount airlines should overbook the flight by 25 seats.
Answer:
Statement true for Imperfect Competition Markets
Explanation:
Marginal Revenue Product is additional revenue due to hiring of additional input, it is product of marginal product & marginal revenue = MP x MR
Value Marginal Product is money value of additional production with additional input, product of marginal product (MP) & price (AR), = MP x AR
Input demand curves are derived demand curves, derived from demand of final goods. In perfect competition, demand is perfectly inelastic & horizontal, AR = MR, so MRP = VMP in this case. In imperfect competition market (oligopoly, monopoly etc) - MR < AR, so MRP < VMP in this case.