Eastman Publishing Company is considering publishng an electronic textbook about spreadsheet applications for business. The fixed cost of manuscrpt preparation, textbook design, and web site construction is estimated to be $160,000, Varable processng costs are estimated to be $6 per book. The publisher plans to sell sngle user access to the book for $46. (a) Buld a spresdsheet model in Excel to calculate the profit/oss for a given demand, What profit can be anticipeted with a demand of 3,500 copies? For subtractive or negative numbers use a minus sign. (b) Use a data table to vary demand from 1,000 to 6,000 in increments of 200 trn test the sensitivity of profit to demand. Breskeven occurs where profit goes from a negabve to a positive value, that s, breakeven is where total revenue - total cast yielding a profit of zero. In which interval of demand dons breakeven occur? (1) Breakeven appears in the interval of 4,200 to 4,800 copies. (i) Breakeven appears in the interval of 4,000 to 4,200 copies. (HI) Breakeven appears in the interval of 3,800 to 4,000 copies. (iv) Breskeven appears in the interval of 3.600 to 3,800 copies. Select your answer (C) Use Goal Seek to arser the following question. With a demand of 3,500 coptes, what is the access price per copy that the publiher must charge to break even? If required, round your answers to two decimal places.
Eastman Publishing Company is considering publishng an electronic textbook about spreadsheet applications for business. The fixed cost of manuscrpt preparation, textbook design, and web site construction is estimated to be $160,000, Varable processng costs are estimated to be $6 per book. The publisher plans to sell sngle user access to the book for $46. (a) Buld a spresdsheet model in Excel to calculate the profit/oss for a given demand, What profit can be anticipeted with a demand of 3,500 copies? For subtractive or negative numbers use a minus sign. (b) Use a data table to vary demand from 1,000 to 6,000 in increments of 200 trn test the sensitivity of profit to demand. Breskeven occurs where profit goes from a negabve to a positive value, that s, breakeven is where total revenue - total cast yielding a profit of zero. In which interval of demand dons breakeven occur? (1) Breakeven appears in the interval of 4,200 to 4,800 copies. (i) Breakeven appears in the interval of 4,000 to 4,200 copies. (HI) Breakeven appears in the interval of 3,800 to 4,000 copies. (iv) Breskeven appears in the interval of 3.600 to 3,800 copies. Select your answer (C) Use Goal Seek to arser the following question. With a demand of 3,500 coptes, what is the access price per copy that the publiher must charge to break even? If required, round your answers to two decimal places.
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter8: Cost Analysis
Section: Chapter Questions
Problem 5E
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Transcribed Image Text:Eastman Publishing Company is considering publishng an electronic textbook about spreadsheet applications for business. The fixed cost of manuscrpt preparation, textbook design, and web site
construction is estimated to be $160,000, Varable processing costs are estimated to be $6 per book. The publisher plans to sell single user access to the book for $46.
(a) Buld a spreadsheet model in Excel to calculate the profit/loss for a given demand, What profit can be anticipeted with a demand of 3,500 copies?
For subtractive or negative numbers use a minus sign.
(b) Use a data table to vary demand from 1,000 to 6,000 in increments of 200 trn test the sensitivity of profit to demand. Breskeven occurs where profit goes from a negabve to a positive value, that
s, breakeven is where total revenue - total cast yielding a profit of zero. In which interval of demand dons breakeven occur?
(1) Breakeven appears in the interval of 4,200 to 4,800 copies.
(i) Breakeven appears in the interval of 4,000 to 4,200 copies.
(HI) Breakeven appears in the interval of 3,800 to 4,000 copies.
(iv) Breskeven appears in the interval of 3.600 to 3,800 copies.
Select your answer
(C) Uise Goal Seek to arswer the following question. With a demand of 3,500 coptes, what is the access price per copy that the publisher mist charge to break even?
If required, round your answers to two decimal places.
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