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# Ch1 - CH1 Problem8 a SalesRevenue 500*4.25=2125 CostofSales...

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CH 1 Problem 8 a Sales Revenue 500*4.25=2125 Cost of Sales            500*3.50=1750 Operating Margin 375 Incremental revenue (100units*2Euro) 200 Tot cost of 600u (600*3.10) 1860 Tot cost of 500u (500*3.50) 1750 Incremental cost  of 100units 110 Incremental profit of 100units 90 Cost per unit of 100 e a,c To maximaze the firms value, GS should accept Kojo's offer because the incremental p 100 new units rises above 3.50 than the cash flow will be lower and the shareholders if For example if the cost per unit is 3.70 instead of 1.10 than the cash flow will be lower  Other consideration should be taken regarding if other customers will continue to pay t Also congestion costs should be taken into consideration and the opportunity cost if a m The following questoin should be also asked: is there a similar law in Belgium like the R b TFC= total fixed cost TVC=total variable cost It is given in the problem that cost per unit is 3.50 when producing 500 units and 3.10 w

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Ch1 - CH1 Problem8 a SalesRevenue 500*4.25=2125 CostofSales...

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