# hw13 - Total operating expense Pretax profit Cumulative...

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Design and Manufacturing I (ME3204) Test 28 Nov 2008 Name: ID: Question (a) Complete the profit model for a consumer product as shown in the following table. (8 marks) Year 2006 2007 2008 2009 Sales Price \$500 \$550 \$550 Number of units sold 50000 100000 100000 Net Sales Cumulative net sales Unit cost \$250 \$220 \$220 Cost of product sold Gross Margin Development cost \$400,000 \$400,000 \$50,000 \$50,000 Total Investment Marketing (13% net sales) other expenses (10% net sales)
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Unformatted text preview: Total operating expense Pretax profit Cumulative profit (SUM(N)) (b) Identify the year of break even and the total profit at the end of the product life from the profit model. (4 marks) (c) Calculate the percentage decrease in total profits due to a 3-month delay in product. (4 marks) (d) Calculate the percentage decrease in total profits for a development cost overrun by 20%. (4 marks)...
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