Q4. (a) Shan Electric manufactures light bulb and is planning to launch a new electricity saver...

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Q4. (a) Shan Electric manufactures light bulb and is planning to launch a new electricity saver solar lamps and bulbs. The market Search has predicted: unit price contribution Sales unit's probality 10 million RS 130-150 8 180-200 5 550 310-350 0.7 The past experiences of the market Research indicated that the Research have been accurate to the extent of 85% 300 400 0.9 0.8 The variation in contribution margin is due to some expected variance in material prices and also due to quality of products at different prices. REQUIRED: (1) (ii) Compute for the best production option available to shan electrics Explain use of expected values and sensitivity analysis in some practical situations Q4. (a) Shan Electric manufactures light bulb and is planning to launch a new electricity saver solar lamps and bulbs. The market Search has predicted: unit price contribution Sales unit's probality 10 million RS 130-150 8 180-200 5 550 310-350 0.7 The past experiences of the market Research indicated that the Research have been accurate to the extent of 85% 300 400 0.9 0.8 The variation in contribution margin is due to some expected variance in material prices and also due to quality of products at different prices. REQUIRED: (1) (ii) Compute for the best production option available to shan electrics Explain use of expected values and sensitivity analysis in some practical situations

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