The Following Monthly Data Are Available for the Challenger Company

question 118

Essay

The following monthly data are available for the Challenger Company and its only product, Product SW:
Required:
a. Without resorting to calculations, what is the total contribution margin at the break-even point?
b. Management is contemplating the use of plastic gearing rather than metal gearing in Product SW. This change would reduce variable costs by $15. The company's marketing manager predicts that this would reduce the overall quality of the product and thus would result in a decline in sales to a level of 350 units per month. Should this change be made?
c. Assume that Challenger Company is currently selling 400 units of Product SW per month. Management wants to increase sales and feels this can be done by cutting the selling price by $25 per unit and increasing the advertising budget by $20,000 per month. Management believes that these actions will increase unit sales by 50%. Should these changes be made?
d. Assume that Challenger Company is currently selling 400 units of Product SW. Management wants to automate a portion of the production process for Product SW. The new equipment would reduce direct labor costs by $20 per unit but would result in a monthly rental cost for the new robotic equipment of $10,000. Management believes that the new equipment will increase the reliability of Product SW thus resulting in an increase in monthly sales of 12%. Should these changes be made?

Know the basic assumptions underlying biomedical therapies.

Understand the qualifications and roles of different mental health specialists.

Differentiate between the various therapeutic techniques and their intended outcomes.

Acknowledge the importance of the therapeutic relationship and the therapist's approach in effective psychotherapy.

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Definitions:

Planetary Geologists

Scientists who study the geology of planets and moons in our solar system and beyond, focusing on their composition, structure, surface processes, and histories.

Rovers

Remote-controlled vehicles designed to move across the surface of a planet or moon, often used in space exploration.

Oldest Terrain

The oldest exposed areas of the Earth's crust, which have survived weathering, erosion, and tectonic activity over vast geological timescales.

Alien World

A term often used to describe planets or moons outside of Earth that posses environments and characteristics markedly different from those found on Earth.