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FinnZ [79.3K]
3 years ago
11

You run a manufacturing facility that makes roller skates. Fixed monthly cost is $50,000 in mortgage, $3,000 per employee on ave

rage in salaries (you have 40 employees) and $20,000 in other expenses. The cost of raw materials is $2 per skate, and other costs per skate average to about $1. You sell the skates for $19.95 each.
You have the option of outsourcing the manufacturing, which will cost you $10 per skate, with a lower fixed cost of $90,000. At what point will you be indifferent between manufacturing yourself versus outsourcing it?

Business
1 answer:
Marysya12 [62]3 years ago
3 0

Answer:

At producing 14,286 skates

Explanation:

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It’s A , I think I could be wrong
3 0
2 years ago
For a honda accord, some factors shift demand left and others shift it right, as shown. classify each factor by how it shifts th
djverab [1.8K]

These are the factors by how it shifts the current demand curve to a new position:

Shifts left

- 2% rebate on a Toyota Camry, a substitute good  

- Big sale coming in three months  

Shifts right

- Free brake inspections

- Consumers' income increases by 10%

7 0
3 years ago
A manufacturer of a very labor-intensive product wishes to employ the 'experience curve' to predict the AVC associated with vari
Rasek [7]

Answer:

with the third doubling, the AVC = $9.11 per unit

Explanation:

The average variable cost (AVC) decreases by 10% with each doubling of cumulative output:

<u>Production level in units</u>                         <u>AVC per unit</u>

    1,000                                                   $12.50 per unit

    2,000                                                  $11.25 per unit

    3,000                                                  $10.13 per unit

    4,000                                                  $9.11 per unit

5 0
3 years ago
If amazon had decided to design and manufacture the kindle and all its components in the united states, what do you think the co
Scrat [10]

Answer:

Brief summary of the case:

The case deals about the evolution of kindle by Company A. When the company decided to introduce kindle, its price was $399 in 2007. Company A understood that to be successful against the huge competitors, kindle must be priced low. It must be highly reliable, many features and elegance must be provided in the design of kindle. "Company A- designed kindle in State C where the research and development expertise is available.

Market research firm "IS," estimated that the manufacturing cost of kindle is about $185. The expensive components of the kindle are the display used in the Electronic ink technology and wireless cord. Company A contracted with Country C's company to produce the display. A manufacturer in Continent A produced a wireless cord of $13. Many components were contracted to the different countries to reduce the cost of the kindle to be competitive. Now, kindle became the competitor to the massive companies.

Determine if the company has decided to manufacture all the components of Electronic reader K in Country U:

If Company had decided to manufacture all the components in Country U, then it would have been more expensive. Company A cannot sell that at an affordable price. Increase in the cost of the components would increase the overall cost of the Electronic reader K. The most important strategy of Company A is to minimize the cost of the product to increase the number of sales.

Increase in the manufacturing cost will dilute their competitive advantage and it increases the cost of the product. It will lower the sales and the buyers would prefer to use the competitors' products, which are cheaper.

Determine if the company has decided to manufacture all the components of Tablet F in Country U:

It would be expensive if they decide to manufacture the components in Country U. It will not affect the sales number like Electronic reader K. as Tablet F is multipurpose. People will prefer quality and specifications than price.

Conclusion:

Manufacturing in Country U would be expensive and it increases the overall cost of the product. It would affect sales of the products.

3 0
3 years ago
Abc company was originally divided into separate units based on function. last year, abc company expanded into several new geogr
7nadin3 [17]
Abc migrated to a Corporation type of company to reduce cost.
3 0
3 years ago
Read 2 more answers
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