Cox Electric makes electronic components

and has estimated the following for a new design of one of its products:

Fixed cost $10,000

Material cost per unit $0.15

Labor cost per unit $0.10

Revenue per unit $0.65

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These data are given in the file CoxElectric. Note that fixed cost is incurred regardless

of the amount produced. Per-unit material and labor cost together make up the variable

cost per unit. Assuming that Cox Electric sells all that it produces, profit is calculated

by subtracting the fixed cost and total variable cost from total revenue.

a. Build an influence diagram that illustrates how to calculate profit.

b. Using mathematical notation similar to that used for Nowlin Plastics, give a mathematical

model for calculating profit.

c. Implement your model from part (b) in Excel using the principles of good spreadsheet

design.

d. If Cox Electric makes 12,000 units of the new product, what is the resulting profit?