gb 203 hw 1

# gb 203 hw 1 - If the Unit Cost was changed from \$2.75 to...

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Very Simple Pricing Model (3/20/2008 Version) Neal Altman GB203 3/30/08 (maximized profit shown) Price= \$8.87 Sales Volume= 61,250 (100,000 plus/minus 100 for each penny under/over \$5) Sales Income= \$543,593.75 Unit Cost= \$2.75 Fixed Costs= \$75,000.00 COGS= \$243,437.50 (Sales Volume * Unit Cost) + Fixed Costs Total Profit= \$300,156.25 (Sales Income - COGS) Required Exercises (but please also experiment on your own) Write down 4 values for A-D and 2 values (Price/Profit) for E A) "What-If" analysis One: Change Price (B3) to \$5.50 and note impact on Total Profit (B11) If the price was changed from \$5.00 to \$5.50 the Total Profit would changed from \$125,000 to \$161,250 B) "What-If" analysis Two: Change Unit Cost (B7) to \$2.50 and note impact on Total Profit (B11)
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Unformatted text preview: If the Unit Cost was changed from \$2.75 to \$2.50 the Total Profit would changed from \$125,000 to \$150,000 C) "Goal Seek" analysis tool to find Price (B3) which results in a Total Profit (B11) of \$200,000 \$6.14 price would result in a profit of \$200,354 D) "Goal Seek" analysis tool to find Fixed Costs (B8) which results in a Total Profit (B11) of \$150,000 \$75,000 fixed costs will result in a total profit of \$150,000 E) "Optimization" analysis (using solver tool) to find what Price (B3) maximizes Total Profit (B11) The price that mazimizes profit is \$8.87 and the profit is maximizes is \$275,156.25 A B C D E F G H 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26...
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## This note was uploaded on 04/23/2008 for the course GB 203 taught by Professor Montissino during the Spring '07 term at Bentley.

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