Benitez company currently outsources a relay switch that is a component in one of its products. the switches cost $35 each. the company is considering making the switches internally at the following projected annual production costs: unit-level material cost $ 7 unit-level labor cost $ 6 unit-level overhead $ 5 batch-level set-up cost (8,000 units per batch) $ 50,000 product-level supervisory salaries $ 50,000 allocated facility-level costs $ 45,000 the company expects an annual need for 8,000 switches. if the company makes the product, it will have to utilize factory space currently being leased to another company for $4,000 a month. if the company decides to make the parts, total costs will be?

The local electronics store is offering a promotion "1-year: same as cash," meaning that you can buy a tv now, and wait a year to pay (with no in

Consider the local telephone company, a natural monopoly. the following graph shows the monthly demand curve for phone services and the company’s marginal revenue (mr), marginal cost (mc), and average total cost (atc) curves. 0 2 4 6 8 10 12 14 16 18 20 100 90 80 70 60 50 40 30 20 10 0 price (dollars per subscription) quantity (thousands of subscriptions) d mr mc atc 8, 60 suppose that the government has decided not to regulate this industry, and the firm is free to maximize profits, without constraints. complete the first row of the following table. pricing mechanism short run long-run decision quantity price profit (subscriptions) (dollars per subscription) profit maximization marginal-cost pricing average-cost pricing suppose that the government forces the monopolist to set the price equal to marginal cost. complete the second row of the previous table. suppose that the government forces the monopolist to set the price equal to average total cost. complete the third row of the previous table. under average-cost pricing, the government will raise the price of output whenever a firm’s costs increase, and lower the price whenever a firm’s costs decrease. over time, under the average-cost pricing policy, what will the local telephone company most likely do

Dahlia enterprises needs someone to supply it with 127,000 cartons of machine screws per year to support its manufacturing needs over the next five years, and you’ve decided to bid on the contract. it will cost you $940,000 to install the equipment necessary to start production; you’ll depreciate this cost straight-line to zero over the project’s life. you estimate that in five years, this equipment can be salvaged for $77,000. your fixed production costs will be $332,000 per year, and your variable production costs should be $11.00 per carton. you also need an initial investment in net working capital of $82,000. if your tax rate is 30 percent and your required return is 11 percent on your investment, what bid price should you submit? (do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))