1. Aztec Furnishings makes hand-crafted furniture for sale in its retail stores. The furniture maker has recently installed a new assembly process, including a new sander and polisher. With this new system, production has increased to 99 pieces of furniture per day from the previous 58 pieces of furniture per day. The number of defective items produced has dropped from 9 pieces per day to 3 per day. The production facility operates strictly eight hours per day. Evaluate the change in productivity for Aztec using the new assembly process. (Round answer to 1 decimal place, e.g. 25.3%.)
2. Med-First is a medical facility that offers outpatient medical services. The facility is considering offering an additional service, mammography screening tests, on-site. The facility estimates the annual fixed cost of the equipment and skills necessary for the service to be $102,000. Variable costs for each patient processed are estimated at $36 per patient. If the clinic plans to charge $56 for each screening test, how many patients must it process a year in order to break even?
3. Slick Pads is a company that manufactures laptop notebook computers. The company is considering adding its own line of computer printers as well. It has considered the implications from the marketing and financial perspectives and estimates fixed costs to be $471,000. Variable costs are estimated at $199 per unit produced and sold.
If the company plans to offer the new printers at a price of $356, how many printers does it have to sell to break even? (Round answer to 0 decimal places, e.g. 125.)
4. Harrison Hotels is considering adding a spa to its current facility in order to improve its list of amenities. Operating the spa would require a fixed cost of $23,800 a year. Variable cost is estimated at $40 per customer. The hotel wants to break even if 11,900 customers use the spa facility. What should be the price of the spa services? (Round answer to 2 decimal places, e.g. 15.25.)
