Assignment 1: Making Decisions Based on Demand and Forecasting ECO 550 – Managerial Economics and Globalization Thursdays (6:00-10:00PM) November 24, 2013 The Pizza Company is considering entering the marketplace in your community. Using this output, we can derive estimated regression line for demand for pizza as; determine that Price (P) = $175, Competitor Price (CP) = $250, Advertisement (A) = $325, Income (I) = $95 Q= 128,832.2 – 19,876 * (P) + 15,467.94 * (CP) + 0.260701 * (A) + 8.780403 * (I) Q= 128,832.2 – 19,876 * 175 + 15,467.64 * 250 + 0.260701 * 325 + 8.780403 * 95 Q= 108,956.2 * 15,642.64 * 250.26 * 333.78 * 95 Q= 518,361.1 Coefficient of determination (or R- square) = 0.977914223. This means 97.79% of the variation
They also faced increased operational expenses of selling, general, and administrative costs by 0.49%. Perhaps the biggest impact on their profit margin is the cost of revenues that were associated with their sales, an increase of 0.92% which affected their EBITDA (Earnings before Interest Tax Depreciation and Amortization). Overall, these show operating expenses as a key issue for the company as the operating income shrank by 2.72% in just a two year period. When analyzing the whole foods balance sheet in common size it shows they have been reducing their short term debt. In 2007, they reduced their current installments of long-term debt by 0.76%, accounts payable by 1.61%, and other current liabilities by 1.35% in just a year as portion of their Liabilities and Shareholders’ Equity.
As a startup business without the marketing and resources that a chain offers I aimed lower initially but looked to build to this range. * I arrived at 875,000 for the initial year by taking into consideration sales from dining and entertainment. The Business profile mentioned that the average family size was 4 people and that the average family spends on average $4 on tokens. So as an average, for every 1 buffet purchased $1 was spent on tokens, which lead me to calculate the average customer spending $8 a visit. I took the 925,000 (the low end) of the CiCi’s pizza average and divided it by the price of their buffett, $5, and
The staff productive time constraint also applied while calculating projected sales revenue for next three years. In this report, the proforma cash flow statement has been provided for the two options that Livaria would consider; keeping the menu as it is or adding vegetarian options to the menu. Because the proforma cash flow is not the in the deficit, and no cash flow issue has been identified for Livaria for the next three years, giving leasing is not considered as alternative. In addition, under both considered alternatives, the company owners’ goal of having $1.1 million in net income will be achieved. The leasing also requires the company mission and vision statement change to
However, C_Fad came out of development and was able to be sold, so a price was set at $35, since it was slightly bigger and a whole unit slower than Cake. C_Fad was created to help appeal to both the low tech and high tech markets, so the price was a compromise for both markets. Marketing budgets were set based on the idea that Cake had been out for 3 years and C_Fad was just getting kick-started. Cake’s Promotions and Sales budget was reduced by $100, down to $1,100, and C_Fad’s Promotions and Sales budget were both set at $1,400. C_Fad was a brand new product appealing to both markets; therefore more money was needed to ensure awareness and accessibility to our customers.
Part (b) Assume that 1,600 meals were served in January. Prepare a flexible budget for this level of activity. Part (c) Actual results for January appear below. Prepare a flexible budget performance report for the diner for January. |Revenue |$18,800 | |Cost of ingredients |5,200 | |Wages |7,200 | |Utilities |928 | |Rent |2,500 | GNB 13e Practice Exam Solutions – Chapter 10 1.
C. E. As the price of pizza increases, consumption of pizzas will decrease. 2. A study of mass-transit systems in American cities revealed that in the long run, revenues generally decline after substantial fare increases. You conclude that: A. The demand for mass transit is price-elastic in the long run.
I believe that it is nominal GDP due to the fact that it measure real numbers. For example, if we have a pizza place and in one year we sell a slice for $1/slice for a year, we sell 100 slices, we will make $100. In the next year we up the price to $1.10 and sell 100 slices, we make $110. That is growth for the company. What does a change in GDP mean to you and your family?
* Additional capital cost will not be incurred and the restaurant will be well positioned to take advantage of the growing population in Dawkins. To stay within the 90% production time, Livoria will have to reduce the estimated demand for eggplant to 88,000 increase working hours for employee 6 by 324 hours in 2015. This will provide a total working hours of 6,320 in 2015
Assignment #1 | CITM 601 | | | | Jessica Padron | 1/21/2013 | | BSB, Inc., The Pizza Wars Come to Campus 1. Does BSB, Inc., enjoy any competitive advantages or core competencies? BSB does enjoy of certain core competencies that help the company overcome the environmental changes. Workforce: BSBs workforce is a core competency because they were flexible when Renee Kershaw made the decision to expand the menu at the grill to include pizzas. The existing workforce was trained to make pizzas and work the new equipment.