You are thinking of opening a small copy and rent a copier. It costs you $1,000
ID: 469880 • Letter: Y
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You are thinking of opening a small copy and rent a copier. It costs you $1,000 to rent a copier for a year and it costs you $0.03 per copy to operate a copier. Other fixed costs of running the store amount to $150 per month. You are planning to charge $0.10 per copy. You are open 365 days per year. A copier can make up to 80,000 copies per year. Given these assumptions, what level of daily demand will enable you to break even? Calculate the annual profits for specified (in this template) daily demands and graph them. Year rental cost Other monthly fixed costs Cost per copy Cost per copy Charge per copy Days per year Copies per copier per year Daily demand (trial value) Total (i.e annual) demand Copies made Total cost Total revenue Total profit For a telephone survey, your department needs to contact atleast 600 wives, 480 husbands, 400 single adult males, and 440 single adult females. It costs $3.20 to make a daytime call and $6.00 to make an evening call. The table below lists the results that can be expected. For example, 30% of all daytime calls are answered by wives, and 15% of all evening calls are answered by single males. Because of a limited staff, at most 40% of all phone calls can be evening calls. Create a model to determine how to minimize the cost of completing the survey. Percentages Daytime Evening Wife 30% 30% Husband 110% 30% Single male 10% 15% Single female 10% 20% Cost/call Max % of evening calls Calls made Max evening calls: Contacts Made Required Wife Husband Single male Single female Total cost Bark's Pet Company produces canned eat food called Meow chow and canned dog food called Bow Chow. The company produces the pet food by blending horse meat, ground fish, and a cereal additive. Each week the company has 600 pounds of horse meat, 800 pounds of ground fish, and 1,000 pounds of cereal additive available to produce both kinds of pet food. Meow Chow must be at least half fish, and Bow Chow must be at least half horse meat. The company has 2, 350 one pound cans available each week. A can of Meow Chow earns $1.10 in profit, and a can of Bow Chow earns $1.40 in profit. The company want s to create a model that will help to maximize its weekly profit. Widgetco produces widgets at plants 1 and 2. It costs 125x^1/2 dollars to produce x units at plant 1 and 235x^1/3 dollars to produce x units at plant 2. Each plant can produce up to 500 units. Each unit produced can be sold for $10. At most 800 widgets can be sold. Determine how Widgetco can maximize its profit. Costs of producing x units at each plant are of form ax^b, where Unit selling prices Number produced Capacity Cost Revenue ProfitExplanation / Answer
Yearly rental cost
1000
$/year
Operating cots
0.03
$/copy
Fixed cost
150
$/month
Selling price
0.10
$/copy
copies per copier
80000
copies/year
days per year
365
a) At Breakeven quantity, Sales = Cost
Assume, breakeven quantity = x copies/year
then,
0.10 x = 1000 + (0.03*x) + (150*12)
solving for x,
0.10 x = 2800 + 0.03 x
0.07 x = 2800
x =
40000
copies/year
Daily demand for breakeven =
110 copies
b) INPUTS
Yearly rental cost
1000
Other monthly fixed costs
150
costs per copy
0.03
chrge per copy
0.10
days per year
365
copies per copier per year
80000
Daily demand (trial value)
190
Total annual demand
69350
(daily demand * 365)
Total cost
$4880.5
(1000+ 150*12 + 0.03*total demand)
Total revenue
$6935
(0.10 * total demand)
Total profit
$2054.5
(total revenue - total cost)
Yearly rental cost
1000
$/year
Operating cots
0.03
$/copy
Fixed cost
150
$/month
Selling price
0.10
$/copy
copies per copier
80000
copies/year
days per year
365
a) At Breakeven quantity, Sales = Cost
Assume, breakeven quantity = x copies/year
then,
0.10 x = 1000 + (0.03*x) + (150*12)
solving for x,
0.10 x = 2800 + 0.03 x
0.07 x = 2800
x =
40000
copies/year
Daily demand for breakeven =
110 copies
b) INPUTS
Yearly rental cost
1000
Other monthly fixed costs
150
costs per copy
0.03
chrge per copy
0.10
days per year
365
copies per copier per year
80000
Daily demand (trial value)
190
Total annual demand
69350
(daily demand * 365)
Total cost
$4880.5
(1000+ 150*12 + 0.03*total demand)
Total revenue
$6935
(0.10 * total demand)
Total profit
$2054.5
(total revenue - total cost)
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