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You have been invited to submit a bid for a contract to produce unique, customised watches in batches of five equal units. Your company makes
You have been invited to submit a bid for a contract to produce unique, customised watches in batches of five equal units. Your company makes high-end timepieces. You know from previous experience that your organisation learns at a rate of 70%. Given that the first unit of this contract required 80 hours of work to finish, it appears to take a substantial amount of effort. The overhead is anticipated to be a set $1000 per unit, and your business will bill clients for its services at a rate of $200 per hour. Your client will compensate you at a pre-set fixed rate per unit. Assuming a nominal profit margin of 50%, calculate your total bid price, the price per unit, and the unit at which you will break even. You have been invited to submit a bid for a contract to produce unique, customised watches in batches of five equal units. Your company makes high-end timepieces. You know from previous experience that your organisation learns at a rate of 70%. Given that the first unit of this contract required 80 hours of work to finish, it appears to take a substantial amount of effort. The overhead is anticipated to be a set $1000 per unit, and your business will bill clients for its services at a rate of $200 per hour. Your client will compensate you at a pre-set fixed rate per unit. Assuming a nominal profit margin of 50%, calculate your total bid price, the price per unit, and the unit at which you will break even
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