Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Answer question 2 please. Question 1 A company produces and sells hair dryers in a market where price (p) and demand (D) are related follows:

image text in transcribed

Answer question 2 please.

Question 1 A company produces and sells hair dryers in a market where price (p) and demand (D) are related follows: p = $35+ (3,000)/D-(4,800)/D2 The fixed cost (Ct) is $800 per month and the variable cost per hair dryer (c.) is $38. - Add to % E Question 2 With reference to the company in Question 1, assume price and demand are unrelated. The company sells the hair dryers for $80 each if they spend $8,000 per month on advertising (C.). CF and c, remain as indicated in Question 1. The maximum production capacity is 5,000 hair dryers per month. a) What is the demand breakeven point? b) Is the company's demand breakeven point (in %) more sensitive to 10% increase in sales price or 20% reduction in variable costs? Explain your

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Engineering Economy

Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling

16th edition

133439275, 133439274, 9780133819014 , 978-0133439274

More Books

Students also viewed these Accounting questions

Question

What opportunities exist for raises and advancement?

Answered: 1 week ago