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Tesla is assessing the costs of producing a new electric vehicle model. The fixed production costs are $300,000,000, and the variable costs are $25,000 per
Tesla is assessing the costs of producing a new electric vehicle model. The fixed production costs are $300,000,000, and the variable costs are $25,000 per vehicle. Tesla expects to produce 10,000 vehicles in the first year. Additionally, battery costs per vehicle are $10,000.
Requirements:
- Calculate the total production costs for the first year, including battery costs.
- Determine the cost per vehicle.
- Analyze the effect of producing 2,000 additional vehicles on total and per-vehicle costs.
- Discuss the significance of managing battery costs in EV production.
- Recommend strategies for cost control in vehicle manufacturing.
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