Imagine you are a business analytics employee at BAT Car Company. The president and CEO of BAT have tasked you with providing them with a data plan addressing expansion of BATs production business into Frankfurt, Germany, on a $40 million Model Z pla
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The Case Study assignment is listed below. The Safe Assign must not exceed 20%. Thank you
Assignment Instructions:
Imagine you are a business analytics employee at BAT Car Company. The president and CEO of BAT have tasked you with providing them with a data plan addressing expansion of BAT’s production business into Frankfurt, Germany, on a $40 million Model Z plant. This $40 million, which encompasses all fixed costs, the BAT CEO plans to apportion equally (25%) each) among the four types of vehicles the Model Z plant will manufacture.All economic and environmental impact studies have been approved. The size of the plant is predicted to be 420 soccer fields in size (a soccer field is 100 yards wide by 130 yards long). The car sales are expected to be: $30,000 per sedan; $50,000 per sports model; $20,000 per small cargo van; and $40,000 per passenger minivan. It will create 10,000 jobs for Frankfurt and the surrounding areas.There have been some issues with protestors regarding the building of an automotive plant that destroys forestland valued at $350 million. There has been some rumbling regarding a group called “Save The Forest” that could implement a cease all actions lawsuit against BAT. Research has shown that previous lawsuits and environmental impact has led to years of litigation and legal fees. The variable costs for the first year’s operation look to be $20,000 per sedan; $40,000 per sports model; $10,000 per small cargo van; and $25,000 per passenger minivan. Sales are expected to be: 40,000 sedans; 5,000 sports cars; 2,000 cargo vans; and 12,000 minivans.Prepare a brief report for the president and CEO of BAT Car Company. Your report should include the following elements:
- an introduction section that describes how the quantitative analysis approach can be applied to this situation;
- BAT’s profit formula results;
- BAT’s break-even point for each vehicle type; and
- your final recommendation on actions to take. (This section should convey to the CEO if the expansion of the production plant is profitable to BAT over the long haul, as well as how to deal with any possible litigation.)
Your final report must be at least three pages in length, and you must show all of your computations (the Unit I Practice Problem Activity will help with this).You can also view a PDF of the Unit I Practice Problem Activity .You should use at least two academic sources in your report, one of which may be your textbook. Adhere to APA Style when constructing this assignment, including in-text citations and references for all sources that are used. Please note that no abstract is needed
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Slide 1 – Title Slide
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Unit I Practice Problems
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Slide 2 – Instructions
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The following slides contain practice problems from page 18 in the textbook. Try to solve the problems, then watch the video solution to check your work. To play the video, simply click on the video and it will open in a new tab.
Instructions
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Slide 3 – Question 1-16
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Problem: Ray Bond sells handcrafted yard decorations at county fairs. The variable cost to make these is $20 each, and he sells them for $50. The cost to rent a booth at the fair is $150. How many of these must Ray sell to break even?
Question 1-16
Solution:
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Slide 4 – Question 1-17
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Problem: Ray Bond, from Problem 1-16, is trying to find a new supplier that will reduce his variable cost of production to $15 per unit. If he was successful in reducing this cost, what would the break-even point be?
Question 1-17
Solution:
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Slide 5 – Question 1-18
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Problem: Katherine D’Ann is planning to finance her college education by selling programs at
the football games for State University. There is a fixed cost of $400 for printing these
programs, and the variable cost is $3. There is also a $1,000 fee that is paid to the university for
the right to sell these programs. If Katherine was able to sell programs for $5 each, how many
would she have to sell in order to break even?
Question 1-18
Solution:
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Slide 6 – Question 1-19
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Problem: Katherine D’Ann, from Problem 1-18, has become concerned that sales may
fall, as the team is on a terrible losing streak and attendance has fallen off. In fact,
Katherine believes that she will sell only 500 programs for the next game. If it was
possible to raise the selling price of the program and still sell 500, what would the price
have to be for Katherine to break even by selling 500?
Question 1-19
Solution:
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Slide 7 – Question 1-20
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Problem: Farris Billiard Supply sells all types of billiard equipment and is considering manufacturing its
own brand of pool cues. Mysti Farris, the production manager, is currenlty investigating the production
of a standard house pool cue that should be very popular. Upon analyzing the costs, Mysti determines
that the materials and labor cost for each cue is $24, and the fixed cost that must be covered is $2,400
per week. With a selling price of $40 each, how many pool cues must be sold to break even? What
would the total revenue be at this break-even point?
Question 1-20
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Solution:
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Slide 8 – End Slide
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Unit I Practice Problems
You have reached the end of the Unit I practice problems. Click the Restart button to return to the beginning if you need further review. Otherwise, you may close your browser window to exit.
Title slide image reference:
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Baranau, D. (n.d.). ID 162189502. Dreamstime. https://www.dreamstime.com/budget-data-people-vector-business-analysis-person-concept-
illustration-financial-account-statistic-graph-management-chart-report-image162189502
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