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Assume consumer demand at 100% requires 70 machines Assume 15 machines wear out each year. Note that not all machines that wear out need to

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Assume consumer demand at 100% requires 70 machines Assume 15 machines wear out each year. Note that not all machines that wear out need to be replaced. End of year total, however, does reflect wear out rate (or number of operational machines available to start new period. 1. Fill in the all the blanks Begin Deman Nee % Change End New End of Year % New Demand Level Need to Year Demand (Required) purchase C Consumer Year Forecast for next period for next period Demand Total 100% 0% 95% (66.5) = 67 95% -5% 105% (73.5) = 74 105% +10% 100% 2 100% 85% 85% 75% 75% 100% 100% 100% 2. Look at the end of year 2 going into year 3. From the above chart you see that you will need to order 22 new machines to begin year 3 because consumer demand rose 10% from the year earlier (last year consumer demand was at 95% of normal and next year it is forecasted to be at 105% of normal). What is the % change in the number of machines you purchased last year (12) as opposed to this year (22)? Show your work! ANS: 3. What conclusion can you draw about the nature of business demand as opposed to consumer demand

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