Your firm designs training materials for computer training classes, and you have

Question

Your firm designs training materials for computer training classes, and you have just received a request to bid on a contract to produce a complete set of training manuals for an 8-session class. From previous experience, you know that your firm follows an 85% learning rate. For this contract, it appears that the effort will be substantial, running 50 hours for the first session. Your firm bills at the rate of $100/hour and the overhead is expected to run a fixed $600 per session. The customer will pay you a flat fixed rate per session (Per Session Price.) If your profit markup is 20%, what will be the Total Price, the Per Session Price, and at what session will you break even?

Explanation / Answer

total price = 8*(50*100+600) = 44800

per session price = (50*100+600) = 5600

profit is 20% so cost = 44600/1.2 = 37333.33

money get after season 1 = 5600

money get after season2 = 13200

money get after season 3 = 16800

money get after season 4 = 22400

money get after season 5 = 28000

money get after season 6 = 33600

money get after season 7 = 39200

so break even at season 7

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