Sheet 2 for second chapter for feasibility study PDF

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Summary

It’s for tutorial for sheet 1 so it’s very important to apply what you learn at feasibility study and this sheet has lots of questions and answers and you can apply what you learn well , good luck...

Description

Faculty of Economics and Political Sciences Economics Department Fourth Year – English and French Sections– 2020/2021 Feasibility Studies Assistant lecturer: Radwa Abdelghaffar

Sheet 2 1) If you have the following functions: P= 12-0.4x C= 0.6 x²+4x+5 What is the maximum price in case of: a) Profit Maximization. b) Sales Revenue Maximization. 2) If Q=1000-4p C= 6000+50q Calculate the maximum price in case of: a) Profit Maximization. b) Sales Revenue Maximization. 3) Given the following: AVC= 10, TFC= 300,000, Expected Unit Sales= 50,000 and The manufacturer wants to earn a 20% mark up on sales, Calculate the mark up price. 4) Given the following: AVC= 10 L.E. per unit, AFC= 20% of AVC and The margin= 15%. What is the mark up price and gross margin?

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5) Given the following: Invested Capital= $1 million, Unit Cost= $16, Unit Sales= 50,000 and Desired Return on investment= 20%. What is the target return price? 6) A textile manufacturer has the following costs and sales expectations: AVC= 20 L.E, TFC= 600,000 L.E. and Expected Unit Sales= 100,000 units a) Compute the mark up price and unit profit if the company wants to earn a 20% mark up on sales. b) If sales do not reach 100,000 units, what is the break-even volume? c) What is the target return price if the company has invested L.E. 2 million in the business and wants to set price to earn a 25% return?

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