Break Even in Unit and Sales Dollars. What is Contribution Margin

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You are selling pepperoni pizzas. This is your only product. You have the following costs:
Fixed Costs:
General Labor $1,500
Rent $3,000
Insurance $200
Advertising $500
Utilities $450
Total $5,650

Variable Costs per Pizza:
Flour $0.50
Yeast $0.05
Water $0.01
Cheese $3.00
Pepperoni $2.00
Total $5.56

What is the minimum price you should charge for the pizza?

If you set your pizza sales price to be $10, what is your contribution margin?

Calculate the break-even sales units and break-even sales dollars

Describe at least THREE ways to INCREASE profit (talking in terms of break-even)

Sample Solution

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Evaluating Corporate Recruiting Plan

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While some traditional organizations have been closing operations in the United States, there are a number of organizations (Amazon, Tesla, Apple, Google, Foxconn, and so forth) that are making significant investments in major new operations. A major concern for these organizations is the ability to recruit and attract employees with the requisite skills needed to fill what are often highly skilled jobs.

Assignment Context

For this assignment, assume that you have been brought in to consult with one of these growing organizations as it prepares to open a new facility. The new facility will be a multi-purpose regional office with 1500 employees in a variety of disciplines. The new employees will be hired for all positions, ranging from a regional VP and senior staff functions, to the customer service team, and the distribution/warehouse team with 400 employees. The new facility will be similar to eight existing facilities in other regions. The following are recruiting plans for different positions:

Recruiting IT and Engineering Positions:

College jobs fairs at 3–4 local universities have been used for entry-level positions. In general, the success rate after one year has been about 50%.
Internships have been used at times (“try before you hire”), but interns have often been hard to recruit.
Professional organizations have been used for positions requiring experience. These organizations post positions on their websites.
Executive recruiters have been used for upper management positions.
Recruiting Administrative and Distribution Center Positions:

Local newspapers have been the major source for local jobs.
Point-of-sale advertising (signs outside the facility) are used, often advertising an onsite job fair.
When hiring needs dictate, current employees are given small ($100) bonuses for job referrals.
Instructions

Evaluate both of these plans. Respond to the following:
Which part of each plan would likely not be successful in recruiting today’s employees? What are the specific limitations you see in these plans?
Which part of each plan would likely continue to be successful? Why would these plans be worthwhile to keep?
A major issue for recruiters today is the issue of diversity and inclusion. Based on your research on this topic, recommend a plan that would address these issues. Your plan should:
Analyze organizational recruiting plans that have been successful in the recruiting of targeted groups.
Include the current legal thinking in this area.
Address a cross section of targeted groups, including minorities, women, veterans, disabled workers, et cetera.
Recommend at least three methods that your research indicates would be successful in this targeted search and justify your recommendations based on this research.
Justify your responses based on current research from at least four peer-reviewed articles.

Sample Solution

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Nutrition & you, by Joan Salge Blake fifth edition

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To what degree do you feel this type of “celebrity image” affects your own feelings about your body image? Does this seem to have more effect on women than on men? (Note that men can now buy shirts that offer girdle-type control.)

  1. After reading this chapter, what “bad habits” do you identify as your own? What strategies can you use to address your particular bad habits? Are some more easily modified than others?
  2. Explain why energy needs are different for everyone. What factors must you consider to determine a person’s energy needs?
  3. The chapter discussed how environmental factors can increase appetite and decrease physical activity. Which of these environmental factors have affected you at some point in your life? Do you see patterns (times when some factors seem to have more influence than others)?

Sample Solution

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Intermediate Macroeconomic Theory

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1 Automatic Stabilizers
Suppose that consumption is modeled as in lecture:
C = c0 + c1YD
where YD = Y − T is disposable income. Now suppose that instead of treating taxes (T) as
exogenous, tax policy is conducted according to the following equation:
T = t0 + t1Y
that is, taxes depend on income. Assume that 0 < t1 < 1. Continue to treat government spending
(G) and investment (I) as exogenous.

  1. Solve for equilibrium output.
  2. What is the multiplier? Does the economy respond more to changes in autonomous spending
    when t1 is 0 or when t1 is positive? Explain.
  3. Why would this type of fiscal policy be called an automatic stabilizer?
    2 Balanced Budget vs. Automatic Stabilizers
    Suppose tax policy is conducted as in the above problem.
  4. Solve for taxes in equilibrium.
  5. Suppose that the government starts with a balanced budget (ie. G = T) and that there is
    then a drop in consumer confidence (c0 drops). What happens to income and taxes?
  6. Suppose that the government adjusts spending (G) to keep the budget balanced. What will
    the effect be on Y ? Does this effect counteract or reinforce the effects of the drop in consumer
    confidence?

Sample Solution

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