Question
The table below gives a detailed forecast of the size of the market by production volume. Assume that KMS expects to capture 10.10% of the
The table below gives a detailed forecast of the size of the market by production volume. Assume that KMS expects to capture 10.10% of the market share in 2013 and expects that percentage will increase by 0.28% per year. KMS currently has the capacity to produce a maximum of 1,100,000 units. What production capacity will KMS require each year? When will an expansion become necessary (that is, when will production volume exceed 1,100,000units)?
Year | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 |
Production Volume (000 units) | ||||||
Market Size | 10,000 | 10,413 | 11,016 | 11,544 | 12,127 | 12,711 |
The Tax Cuts and Jobs Act of 2017 temporarily allows 100% bonus depreciation (effectively expensing capital expenditures). However, we will still include depreciation forecasting in this chapter and in these problems in anticipation of the return of standard depreciation practices during your career.
KMS's market share for 2013 is______
units.(Round to the nearest integer.)
KMS's market share for 2014 is_____
units.(Round to the nearest integer.)
KMS's market share for 2015 is ______-
units.(Round to the nearest integer.)
KMS's market share for 2016 is ________
units.(Round to the nearest integer.)
KMS's market share for 2017 is _______
units. (Round to the nearest integer.)
KMS's market share for 2018 is _____
units.(Round to the nearest integer.)
When will an expansion become necessary (that is, when will production volume exceed 1,100,000
units)?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
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