1. Company: Tesla

Scenario: Production Cost Analysis

Data:

• Fixed Manufacturing Costs: $1,200,000
• Variable Manufacturing Costs per Car: $20,000
• Cars Produced: 500

Requirements:

1. Calculate the total manufacturing costs.
2. Determine the cost per car.
3. Analyze the effect of producing 100 more cars on total and per-car costs.
4. Discuss the importance of understanding fixed and variable costs in production planning.
5. Recommend strategies to manage production costs effectively.
6. Evaluate the potential cost savings from automation.