Posted by **Charles** on Wednesday, December 9, 2009 at 1:20pm.

A) The total market for high density TV’s is estimated to be 600,000 units. Product development and marketing costs for market entry are $30,000,000. The marketing department anticipates a selling price of $2,000 and a variable cost of $1,500. What market share would the company have to obtain in order to make a $1,000,000 profit on the project? (Looking for answer as a percentage)

I’m not sure where to start with this problem. Any ideas?

B) Your company, Bozo Industries, sold a telephone system to a company in Great Britain on June 1, 2009. The agreed upon price was $2,000,000. The exchange rate as of June 1 is one pound = $1.7883. The British have agreed to pay 1,118,381 pounds in early Dec. 2009, the delivery date for the phone system. Who is bearing the exchange rate risk in this transaction? Look up the rate today (assume it is the delivery date) and compute how much exchange rate gain or loss will there be?

For B the British Pound to U.S. dollar is 1.6198 as of today the 9th. I took the exchange rate of $1.7883 and subtracted from the current exchange rate of 1.6198 which equaled .1685. I than multiplied .1685 by 2,000,000 and got $337,000. So the U.S company lost $337,000 for this transaction. Is my work correct?

Thanks in advance.

- Marketing -
**bobpursley**, Wednesday, December 9, 2009 at 1:37pm
B is correct.

A) profit-cost=1,000,000

500n-30,000,000=1,000,000

n= 62,000

check that.

percent of market: 62,000/600,000 x 100

## Answer This Question

## Related Questions

- accounting - "Harris Company manufactures and sells a single product. A ...
- math - Dynacan Ltd. manufactured 10,000 units of product last year FC= 22,200,...
- Accounting - If fixed costs are $240,000, the unit selling price is $32, and the...
- Accounting - Mushroom Company, a retail company, has two departments, "G" and "S...
- business finance - HELP ME GET STARTED ON THIS. I don't know what to do with the...
- Marketing - A manufacturer of AC units realizes a cost of $55.00 for every unit ...
- Math - The Oliver Company plans to market a new product. Based on its market ...
- Managerial Economics - You are considering setting up a software development ...
- Economics - A fishing boat owner brings 50,000 fish to market and the market ...
- Marketing - Explain why fixed and variable costs per unit decline as sales ...

More Related Questions