PS.51 Tech solutions has contracted with a cell phone manufacturer to create a special chip to...

 

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PS.51 Tech solutions has contracted with a cell phone manufacturer to create a special chip to allow people to make banking transactions on their cell phones. Tech Solutions has contracted to sell 247,000 units. The selling price for the chip is $70 per unit. They need to decide which production process is best suited for the chip. To help accomplish this, the firm has gathered the following production cost data: Process Eastern Foundry Western Foundry Old Fab New Fab Eastern Foundry Fixed Costs $1,250,000 $1,850,000 $4,850,000 $8,091,000 Labor/Unit $17.94 $16.33 $14.96 $13.91 Based on the given demand, price, and cost data, which process option is best? O Western Foundry O New Fab O Old Fab Material Cost/Unit O Old Fab $22.88 $22.71 $21.23 $21.23 For the process option you selected in the previous question, what will be the gross profit? (Display your answer to the nearest whole number). 5957460 O Eastern Foundry O Western Foundry O New Fab If demand were to increase, what would be the break-even point (in unit volume or demand) between the process option you. selected above and the "Western Foundry" process option? (Display your answer to the nearest whole number). 337079 For a volume that is 3 units greater than the break-even point (answered in the previous question), which process option would be best? PS.51 Tech solutions has contracted with a cell phone manufacturer to create a special chip to allow people to make banking transactions on their cell phones. Tech Solutions has contracted to sell 247,000 units. The selling price for the chip is $70 per unit. They need to decide which production process is best suited for the chip. To help accomplish this, the firm has gathered the following production cost data: Process Eastern Foundry Western Foundry Old Fab New Fab Eastern Foundry Fixed Costs $1,250,000 $1,850,000 $4,850,000 $8,091,000 Labor/Unit $17.94 $16.33 $14.96 $13.91 Based on the given demand, price, and cost data, which process option is best? O Western Foundry O New Fab O Old Fab Material Cost/Unit O Old Fab $22.88 $22.71 $21.23 $21.23 For the process option you selected in the previous question, what will be the gross profit? (Display your answer to the nearest whole number). 5957460 O Eastern Foundry O Western Foundry O New Fab If demand were to increase, what would be the break-even point (in unit volume or demand) between the process option you. selected above and the "Western Foundry" process option? (Display your answer to the nearest whole number). 337079 For a volume that is 3 units greater than the break-even point (answered in the previous question), which process option would be best?

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