Assume that your R&D team has a new design for their product Able next round that can reduce their material cost of producing units from $8.59 to $7.73. They pass on half of all cost savings by cutting the current price to customers. For simplicity: Use current labor cost of $8.37 Assume all period costs as reported on Andrews Income Statement for Asia Pacific (Annual Report Page 5) will remain the same. Current price is equivalent to $30.00 Shipping cost to Asia Pacific is $2.50 per unit Determine how many units (000's) of product Able would need to be sold in Asia Pacific alone next round to break even on the product. 386 units 297 units 302 units 371 units

Production Analysis The Production Analysis page has key data concerning the capacity and automation levels of competitors' plants, plus a range of other critical information for competitive analysis. Plant Details Andrews Baldwin Chester Digby Capacity 3,250 3,000 3,300 2,900 Automation 4.5 4.3 6.5 6.0 Name Units Sold Production Outsource Inventory Americas Inventory Europe Inventory Asia-Pacific Average Price Average Material Costs Average Labor Costs Average Shipping Able 3417 1930 1275 135 0 0 $30.00 $9.75 $9.44 $1.89 Acre 1295 1287 0 34 53 0 $38.00 $13.39 $8.43 $1.46 Baker 1715 1534 0 235 163 2 $40.00 $13.66 $8.64 $1.20 Bold 963 1039 0 43 33 0 $40.50 $14.61 $8.63 $1.23 Cake 2226 2277 50 226 0 151 $28.00 $9.08 $6.02 $1.06 Cookie 1402 990 500 229 0 95 $27.25 $6.73 $7.54 $0.89 Daze 1975 2029 0 249 142 0 $26.00 $7.55 $6.43 $1.80 Drive 565 643 0 59 18 0 $38.25 $13.68 $6.44 $1.0