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The cost to a manufacturer of flat panel displays for producing its newly designed TV Display 1000 is $250.00. The cost for Research and Development of their new product being sold to OEMs as a component product has been one million dollars. The sales and promotional budget is $600,000, and all other fixed costs amount to $200,000. The Marketing Director and his staff have estimated demand for the new display to be between 50,000 and 75,000 units over the next year. They also have decided to price the new Display 1000 at $450 to their OEM customers.

(a) How many Display 1000s does the manufacturer have to sell in order to breakeven?

(b) What is the manufacturer’s unit contribution to profit in percentage?

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M91874031

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