Question
Dan Mullen is employed by a mail-order distributor and reconditions used desktop computers, broadband routers, and laser printers. Dan is paid $12 per hour, plus
Dan Mullen is employed by a mail-order distributor and reconditions used desktop computers, broadband routers, and laser printers. Dan is paid $12 per hour, plus an extra $6 per hour for work in excess of 40 hours per week. The distributor just announced plans to outsource all reconditioning work. Because the distributor is pleased with the quality of Dan's work, he has been asked to enter into a long-term contract to recondition used desktop computers at a rate of $40 per computer, plus all parts. The distributor also offered to provide all necessary equipment at a rate of $200 per month. Dan has been informed that he should plan on reconditioning as many computers as he can handle, up to a maximum of 20 per week.
Dan has room in his basement to set up a work area, but he is unsure of the economics of accepting the contract, as opposed to working for a local Radio Stuff store at $11 per hour. Data related to the time spent and the number of units of each type of electronic equipment Dan has reconditioned in recent weeks is as follows:
Total Hours | Printers | Routers | Computers | Total Units |
---|---|---|---|---|
40 | 4 | 5 | 5 | 14 |
42 | 0 | 7 | 6 | 13 |
40 | 4 | 3 | 7 | 14 |
46 | 0 | 2 | 12 | 14 |
48 | 11 | 6 | 4 | 21 |
44 | 5 | 8 | 3 | 16 |
44 | 5 | 8 | 3 | 16 |
43 | 5 | 6 | 5 | 16 |
53 | 2 | 6 | 10 | 18 |
46 | 8 | 4 | 6 | 18 |
Assuming he wants to work an average of 40 hours per week, what should Dan do?
Step by Step Solution
3.39 Rating (161 Votes )
There are 3 Steps involved in it
Step: 1
To determine what Dan should do lets analyze the two options accepting the contract to recondition desktop computers for the distributor or working for the Radio Stuff store Option 1 Accepting the con...Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started