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Fill in your calculations to each question. AFG communications, based out of Waterloo Ontario, is a small but growing manufacturer of business class network routers.
Fill in your calculations to each question. AFG communications, based out of Waterloo Ontario, is a small but growing manufacturer of business class network routers. Currently they produce two main types, Model A and the more expensive variant, Model B. The company has a capacity of producing 800 Model A routers per month and currently produces 450 every month which they sell to small computer stores in eastern provinces. The company's expenses are as follows: $6000 per month lease of production facility, salaries of $10500 per month and other expenses of $3000 per month. Production of each router costs AFG $10 in materials per router, $15 in labour per router and $10 per router for R&D. They sell their routers for $125. AFG has decided to increase its production from the current 450 per month level to 700 per month while at the same time lowering its selling price to $105. 8. How would this change the company's net income? $ At the selling price of $105, a chain store wanted to purchase an additional 750 units per month on a regular basis. AFG expanded the facility by renting additional space. This increase their fixed cost by 20% and doubled their capacity. 9. What is the new FC? $ 10. What would be the company's net income per month it were operating at 100% of the new facility's capacity? $
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