(10p) 4- Suppose that an airplane manufacturer wants to make a preliminary estimate of the cost of building a 600-MW plant for the assembly of its new aircraft. It is known that a 200-MW plant cost $100 million 20 years ago when the approximate cost index was 400, and that cost index is now 1,200. The cost-capacity factor for a fossil-fuel power plant is 0.79.

(10p) 5- Based on the following data, develop a weighted index for the price of a gallon of gasoline in 2014, when 1996 is the reference year having an index value of 99.2. The weight placed on regular unleaded gasoline is three times that of either premium or unleaded plus, because roughly three times as much regular unleaded is sold compared with premium or unleaded plus. Price (Cents/Gal) in Year 1996 2010 2014 Premium 114 240 315 Unleaded plus 103 230 305 Regular unleaded 93 221 285

(15p) 6- A manufacturer is designing a new product, and would like to estimate the cost for this product. The production capacity is 500 units per day. The operating cost is $1000 per day. A worker can product 40 units of product per day, and the unit cost of direct labor is $160 per worker per day. Indirect labor cost is 30% of direct labor cost. One unit of product needs 0.5 pounds of raw material, and the material price is $15 per pound. (1) Please write down all the cost components to be considered in estimating the manufacturing cost of this new product. (2) Please calculate the manufacturing cost per unit of product. (note: the number of workers needed for each day does not have to be an integer in your calculation.) (3) What is the target cost if the manufacturers expected profit margin is 10% and its competitors price is $15.5.

(15p) 7- Sandira Industries is a producer of devices used in the jet industry. Normal production level is 60 pics per month, but due to improved economic conditions in China, production is at 72 per month. The following information is available. Fixed costs = $2.4 million per month Variable cost per unit =$35,000 Revenue per unit = $75,000 (a) Determine the breakeven number of units (b) What is the current profit level per month for the facility? (at Q=72 units per month) (c) What is the difference between the revenue and variable cost per piece that is necessary to break even at a significantly reduced monthly production level of 45 units, if fixed costs remain constant?