What is the profit that the studio expects to make

Assignment Help Operation Management

Reference no: EM131122501

Topgun Records and several movie studios have decided to sign a revenue-sharing contract for CDs. Each CD costs the studio $1.5 to produce. The CD will be sold to Topgun for $2.5. Topgun in turn prices a CD at $13 and forecasts demand to be normally distributed, with a mean of 8,000 and a standard deviation of 2,500. Any unsold CDs are discounted to $1, and all sell at this price. Topgun will share 35 percent of the revenue with the studio, keeping 65 percent for itself.

a) How many CDs should Topgun order?

b) How many CDs does Topgun expect to sell at a discount?

c) What is the profit that Topgun expects to make?

d) What is the profit that the studio expects to make?

Reference no: EM131122501

Questions Cloud

American cultural and social tensions of the time : Write an essay of 500 to 750 words (with a typical font and spacing this will be between 2 and 3 pages) on the following topic: Choose one or more films that you have viewed in a screening for this course or in your personal viewing. Discuss the i..

What is the amount of the gross profit : During the current year, merchandise is sold for $32,800 cash and $379,500 on account. The cost of the merchandise sold is $250,000. What is the amount of the gross profit?

Movements in english literature : Produce an original opinion based on assigned literature and the fourth learning objective: Discuss major literary movements in English literature from the 18th century to the present. 200 word min. (I asked this same question last night and the ..

Who bears the freight when the terms of sale are : Who bears the freight when the terms of sale are?

What is the profit that the studio expects to make : Topgun Records and several movie studios have decided to sign a revenue-sharing contract for CDs. Each CD costs the studio $1.5 to produce. The CD will be sold to Topgun for $2.5. Topgun in turn prices a CD at $13 and forecasts demand to be normally ..

Calculated the overall mean absolute deviation : Develop forecasts for months April to July using a moving average model with AP=3 and then calculated the overall Mean Absolute Deviation (MAD) and Tracking Signal (TS) for months April to June. Develop a linear regression equation to forecast the sa..

What is the nature of : A debit memo issued by the buyer of merchandise?

How transformational leaders get involve and influence : How transformational leaders get involve and influence followers through a complex and interrelated set of behaviors and abilities.

Determining your management plan : You will prepare the classroom management plan for a specific classroom. If you are currently teaching, you should prepare the plan for your own classroom. If you are not currently teaching in your own classroom, please build your project around y..

User Account

All Pages