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ANSWER ALL QUESTIONS DON'T ANSWER IF YOU CANT ANSWER ALL I NEED THEM WELL EXPLAINED THANKS A firms production capacity is 1.5 million units, with
ANSWER ALL QUESTIONS DON'T ANSWER IF YOU CANT ANSWER ALL I NEED THEM WELL EXPLAINED THANKS A firms production capacity is 1.5 million units, with annual fixed costs of $3.2 billion for depreciation, plant maintenance, corporate marketing, and general overhead. Additional values for the three vehicles produced and sold by the firm are shown in the table below: 1. How will you allocate the fixed costs across the products? 2. Calculate the break-even units for each product, showing the intermediate calculations for the allocated fixed costs and selling price (dealer invoice). 3. What impact does a 10% drop in MSRP have on the break-even point for each vehicle? 4. Using the original MSRP, recalculate break-even if advertising and promotion expense for each product is doubled. 5. What impact might the introduction of a new product in your vehicle line have on fixed costs and the break-even calculation?
VEHICLE X VEHICLE Y VEHICLE Z MSRP Dealer Discount Variable Cost Adv. & Promo. Prev. Unit Sales $15,999 10% $11,799 35 million 400 thousand $20,999 12% $13,599 $50 million 00thousand $25,999 15% $16,899 $70 million 300 thousandStep by Step Solution
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