1) A company produces circuit boards used to update outdated computer equipment.

The fixed cost is $42,000 per month, and the variable cost is $53 per circuit board. The selling price per unit is p = 150 0.02D. Maximum output of the plant is $4,000 units per month. a) Determine the optimum demand for this product? b) What is the maximum profit per month? c) At what volumes does breakeven occur? d) What is the companys range of profitable demand?

2) A farmer estimates that if he harvests his soybean crop now, he will obtain 1000 kilos, which he can sell at $3.00 per bushel. however he estimates this crop will increase by an additional 1,200 kilos of soybeans for each week he delays harvesting but the price will drop at a rate of 50 cents per kilo per week; in addition, it is likely that he will experience spoilage of approximately 200 kilos per week for each week he delays harvesting. When should he harvest his crop to obtain the largest net cash return, and how much will be received for his crop at that time?

3) A set of unsharpened tools costs $500 and can be ground 20 times. The cost of each grinding is $25. The time required to change and reset the tools is 1.5 hours,and such changes are made by a tool-setter who is paid $8.00 per hour. Variable overhead on the machine is charged at the rate of $3.75 per hour, including tool-changing time. At which speed should the machine be operated to minimize total cost per piece? The basic trade-off in this problem is between the rate of output and tool usage.

4) The heat loss through the exterior walls of a certain poultry processingplant is estimated to cost the owner $3,000 next year. A salesman fromSuperfiber insulation, has told you, the plant manager, that he canreduce the heat loss by 80% with the installation of $18,000 worth of Superfiber now. If the cost of heat loss rises by $200 per year (gradient)after the next year and the owner plans to keep the building for 15 more years, what would you recommend if the interest rate is 8% per year?

5) A proposed product modification to avoid production difficulties will require an immediate expenditure of $175,000 to modify certain dies. What annual savings must be realized to recover this expenditure in 6 years with interest at 8% per year?

6) How many deposits of $100 each must you make at the end of each month if you desire to accumulate $3350 for a new home entertainment center? Your savings account pays 9% nomial interests, compounded monthly.

7) A certain savings-and-loan association advertises that it pays 8% nomial interest compounded quarterly. What is the effective interest per annum? If you deposit $5000 now and plan to withdraw it in 3 years how much would you account be worth at that time?

8) Your mothly mortgage payment (principal plus interest) is $50. If you have 125 month loan with a fixed interest rate of 6% compounded monthly, how much did you borrow from the bank to purchase your house?