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Q4. (a) Shan Electric manufactures light bulb and is planning to launch a new electricity saver solar lamps and bulbs. The market Search has
Q4. (a) Shan Electric manufactures light bulb and is planning to launch a new electricity saver solar lamps and bulbs. The market Search has predicted: unit price contribution Sales unit's probality 10 million RS 130-150 8 180-200 5 550 310-350 0.7 The past experiences of the market Research indicated that the Research have been accurate to the extent of 85% 300 400 0.9 0.8 The variation in contribution margin is due to some expected variance in material prices and also due to quality of products at different prices. REQUIRED: (1) (ii) Compute for the best production option available to shan electrics Explain use of expected values and sensitivity analysis in some practical situations
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