Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Ollivanders Co. is investigating a new swimwear product line for its apparel division. Recent advances in fabric technology and aerodynamic styling have resulted in bodysuits

Ollivanders Co. is investigating a new swimwear product line for its apparel division. Recent advances in fabric technology and aerodynamic styling have resulted in bodysuits that are highly prized by competitive swimmers. Ollivanders’ sales staff reports that customers are requesting these high-tech bodysuits. Before Ollivanders commits to manufacturing the suits, Florian Fortescue, VP of Marketing,wants to analyze sales price options and evaluate the profitability of the product he plans to call the WizardSkin. The sales group at Ollivanders has estimated that it could sell about 3000 units of WizardSkin at a price of $129.95. What if this estimate of the number of units sold is incorrect? What if the projected number of swimmers who want to wear WizardSkin is too optimistic? The company has a policy that all prices must end in 9.95. For now, Florian makes the following assumptions about costs. Manufacturing cost per unit of the product is $75.75 and the fixed manufacturing cost is $52,000. Distribution cost per unit is $5. Marketing cost is $75,000 and Selling and Administrative cost is $18,000.

a. Draw the Influence Diagram and the Black Box Diagram for this problem. 

b. Prepare the layout of the spreadsheet model for this problem. 

c. Build the base case spreadsheet model to help Florian.


Step by Step Solution

3.34 Rating (160 Votes )

There are 3 Steps involved in it

Step: 1

a Draw the Influence Diagram and the Black Box Diagram for this Problem Influence Diagram The Influence Diagram ID is a graphical representation of the problem that shows the relationships between the ... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Money Banking and Financial Markets

Authors: Stephen Cecchetti, Kermit Schoenholtz

4th edition

007802174X, 978-0078021749

More Books

Students also viewed these Economics questions