1)) The PlasmaPix company has developed a new, 50” curved panel 3D TV, which it
ID: 433502 • Letter: 1
Question
1)) The PlasmaPix company has developed a new, 50” curved panel 3D TV, which it intends to sell directly to consumers via the internet. At a selling price of $999 PlasmaPix estimates that it will sell 30,000 units. It costs $700 per unit to produce each flat panel TV and deliver it to the customer. If PlasmaPix incurs fixed overhead expenses of $5 million, how much net profit will it earn?
A) $8,970,000
$29,970,000
$3,970,000
$1.794
2)) Which of the following factors should be taken into consideration when setting the price of a new product?
The cost of raw materials, parts, and labor.
The image of the company that makes the product.
The perceived value of the product to potential buyers.
All of the above.
A) $8,970,000
B)$29,970,000
C)$3,970,000
D)$1.794
Explanation / Answer
Selling price = 999
Quantity = 30,000
Cost = 700
Fixed cost = 5000000
Profit = (Selling price-Cost)*Quantity – Fixed cost
Profit = (999-700)*30000 – 5000000
Profit = $3,970,000
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