Question

Your Competitive Intelligence team is predicting that the Baldwin Company will invest in adding capacity to their Beetle product this year. Assume Baldwin's product Beetle invests in increasing its capacity by 10% this year. Because of this new information, your company anticipates all other products in the Core segment will increase their capacity by the same amount. How much can the industry produce in the Core segment the next year

Answer 1

Answer: 13,288 units

Explanation:

I attached a table showing the production capacities since it was missing.

Since your company believes that all core products will increase capacity by the same amount, we can solve for this by,

= (1,200 + 1,450 + 1,040 + 1,050 + 100 + 1,200) * ( 1 + 0.1)

= 6,040 * 1.1

= 6,644

A tricky part of this question is that you have to remember that Baldwin can produce twice this as they could have a 2nd shift.

That means the value will become,

= 6,644 * 2

= 13,288 units

The industry can produce 13,288 units in the Core segment the next year.