You work for a company that produces molds for concrete castings, and are approached by a local art firm to do a large project. They want you to make 10 simple molds and 2x10 complex molds. In order to do this operation you would need to buy an additional $8,919 worth of equipment. The cost to make each simple mold for your firm is generally $3,446 in labor plus $1000 in materials. To make complex molds, there is generally a base cost of $6000 in labour, plus $1200 in materials. Additionally, each complex mold requires finishing at a rate of $130/hour, with an average of 5 hours per part of finishing. The parts also require paying overtime rates for shop work, which is 8.95% of the total finishing cost and labour cost for all the molds. What is the minimum price that the vendor must pay you to have this project be profitable (break even)?

You work for a company that produces molds for concrete castings, and are approached by a local art firm to do a large project. They want you to make 10 simple molds and 2x10 complex molds. In order to do this operation you would need to buy an additional $8,919 worth of equipment. The cost to make each simple mold for your firm is generally $3,446 in labor plus $1000 in materials. To make complex molds, there is generally a base cost of $6000 in labour, plus $1200 in materials. Additionally, each complex mold requires finishing at a rate of $130/hour, with an average of 5 hours per part of finishing. The parts also require paying overtime rates for shop work, which is 8.95% of the total finishing cost and labour cost for all the molds. What is the minimum price that the vendor must pay you to have this project be profitable (break even)?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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