Chat with AI
Introduction to Management Science 12th Edition by Bernard Taylor
Edition 12ISBN: 978-0133778847Introduction to Management Science 12th Edition by Bernard Taylor
Edition 12ISBN: 978-0133778847 Exercise 9
In Problem, Annie has used historical weather data to determine that next season there is a 60% chance that the weather will be good and a 40% chance the weather will be bad. Given this additional information, what do you think Annie's decision should be and why
Problem
Although Annie Russell (in problem) has been told by the athletic department at Tech that all the games will likely be sell outs, she is aware that the weather will affect how many fans will actually attend the games and buy hot dogs. Fans are less likely to attend the game if the weather is too hot or too cold and will not buy hot dogs if the weather is cold. Considering these new factors Annie has decided to analyze her decision-making situation to consider the possible outcomes given different weather conditions. If the weather is good all season she estimates that if she sells hotdogs for $3.25, she will sell 7,000, but if the weather is bad she will sell only 5,500. On the other hand, if she charges $4.00 for a hotdog and the weather is good, she will sell 6,000, but if the weather is bad she will sell only 3,500. Which price do you think Annie should sell the hotdogs for Explain your reason.
Problem
Annie Russell, a student at Tech, plans to open a hot dog stand inside Tech's football stadium during home games. There are seven home games scheduled for the upcoming season. She must pay the Tech athletic department a vendor's fee of $3,000 for the season. Her stand and other equipment will cost her $4,500 for the season. She estimates that each hot dog she sells will cost her $0.35. She has talked to friends at other universities who sell hot dogs at games. Based on their information and the athletic department's forecast that each game will sell out, she anticipates that she will sell approximately 2,000 hot dogs during each game.
a. What price should she charge for a hot dog in order to break even
b. What factors might occur during the season that would alter the volume sold and thus the break-even price Annie might charge
c. What price would you suggest that Annie charge for a hot dog to provide her with a reasonable profit while remaining competitive with other food vendors
Problem
Although Annie Russell (in problem) has been told by the athletic department at Tech that all the games will likely be sell outs, she is aware that the weather will affect how many fans will actually attend the games and buy hot dogs. Fans are less likely to attend the game if the weather is too hot or too cold and will not buy hot dogs if the weather is cold. Considering these new factors Annie has decided to analyze her decision-making situation to consider the possible outcomes given different weather conditions. If the weather is good all season she estimates that if she sells hotdogs for $3.25, she will sell 7,000, but if the weather is bad she will sell only 5,500. On the other hand, if she charges $4.00 for a hotdog and the weather is good, she will sell 6,000, but if the weather is bad she will sell only 3,500. Which price do you think Annie should sell the hotdogs for Explain your reason.
Problem
Annie Russell, a student at Tech, plans to open a hot dog stand inside Tech's football stadium during home games. There are seven home games scheduled for the upcoming season. She must pay the Tech athletic department a vendor's fee of $3,000 for the season. Her stand and other equipment will cost her $4,500 for the season. She estimates that each hot dog she sells will cost her $0.35. She has talked to friends at other universities who sell hot dogs at games. Based on their information and the athletic department's forecast that each game will sell out, she anticipates that she will sell approximately 2,000 hot dogs during each game.
a. What price should she charge for a hot dog in order to break even
b. What factors might occur during the season that would alter the volume sold and thus the break-even price Annie might charge
c. What price would you suggest that Annie charge for a hot dog to provide her with a reasonable profit while remaining competitive with other food vendors
Explanation
Verified
Verified
Break even quantity is the quantity at w...
Introduction to Management Science 12th Edition by Bernard Taylor
Why don’t you like this exercise?
Other Minimum 8 character and maximum 255 character
Character 255
