Question: please help asap i will give an upvote! ViewDu Concepts, Inc. (VDC) manufactures a line of industrial monitors sold primarily to high speed process manufacturers.
ViewDu Concepts, Inc. (VDC) manufactures a line of industrial monitors sold primarily to high speed process manufacturers. The line currently consists of three models. The following data are available regarding the models: VDC is considering the addition of a fourth model (LX4) to its line of monitors. The LX4 would be sold for $375. The variable cost of this unit is $225. The demand for the new LX4 model is estimated to be 400 units per year. Sixty-three percent of these unit sales of the new model is expected to cannibalized from other models already being manufactured by VDC ( 5 percent from Model LX1, 18 percent from Model LX2, and 50 percent from Model LX3). VDC will incur a one-time fixed cost of $20,000 to add the new model to the line. Based on the above data, should VDC add the new Model LX4 to its line of TV's? Why? Your answer should provide solid evidence to support your position. ViewDu Concepts, Inc. (VDC) manufactures a line of industrial monitors sold primarily to high speed process manufacturers. The line currently consists of three models. The following data are available regarding the models: VDC is considering the addition of a fourth model (LX4) to its line of monitors. The LX4 would be sold for $375. The variable cost of this unit is $225. The demand for the new LX4 model is estimated to be 400 units per year. Sixty-three percent of these unit sales of the new model is expected to cannibalized from other models already being manufactured by VDC ( 5 percent from Model LX1, 18 percent from Model LX2, and 50 percent from Model LX3). VDC will incur a one-time fixed cost of $20,000 to add the new model to the line. Based on the above data, should VDC add the new Model LX4 to its line of TV's? Why? Your answer should provide solid evidence to support your position
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
