Eastlan Publishing Company is considering publishing an electronic textbook about spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and web-site construction is estimated to be $150,000 Variable processing costs are estimated to be $7 per book. The publisher plans to sell single-user access to the book for $49. Through a series of web-based experiments, Eastman has created a predictive model that estimates demand as a function of price. The predictive model is demand - 4,000 - 6p, where p is the price of the e-book. (a) Build a spreadsheet model to calculate the profit/loss for a given demand. What is the demand? (b) Use Goal Seek to calculate the price that results in breakeven. If required, round your answer to two decimal places. (c) Use a data table that varies price from $50 to $400 in increments of $25 to find the price that maximizes profit. If Eastman sells the single-user access to the electronic book at a price of $ it will earn a maximum profit of $
Eastlan Publishing Company is considering publishing an electronic textbook about spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and web-site construction is estimated to be $150,000 Variable processing costs are estimated to be $7 per book. The publisher plans to sell single-user access to the book for $49. Through a series of web-based experiments, Eastman has created a predictive model that estimates demand as a function of price. The predictive model is demand - 4,000 - 6p, where p is the price of the e-book. (a) Build a spreadsheet model to calculate the profit/loss for a given demand. What is the demand? (b) Use Goal Seek to calculate the price that results in breakeven. If required, round your answer to two decimal places. (c) Use a data table that varies price from $50 to $400 in increments of $25 to find the price that maximizes profit. If Eastman sells the single-user access to the electronic book at a price of $ it will earn a maximum profit of $
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter13: Regression And Forecasting Models
Section13.3: Simple Regression Models
Problem 9P
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![Eastan Publishing Company is considering publishing an electronic textbook about spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and web-site construction is estimated to be $150,000.
Variable processing costs are estimated to be $7 per book. The publisher plans to sell single-user access to the book for $49.
Through a series of web-based experiments, Eastman has created a predictive model that estimates demand as a function of price. The predictive model is demand = 4,000 - 6p, where p is the price of the e-book.
(a) Build a spreadsheet model to calculate the profit/loss for a given demand. What is the demand?
(b) Use Goal Seek to calculate the price that results in breakeven. If required, round your answer to two decimal places.
(c) Use a data table that varies price from $50 to $400 in increments of $25 to find the price that maximizes profit.
If Eastman sells the single-user access to the electronic book at a price of S
it will earn a maximum profit of $](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1729e621-63e5-4d86-97bc-cc16ce87204a%2F08bfcd8d-343a-4aae-b45f-9c6892533aa8%2Fb4umhtj_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Eastan Publishing Company is considering publishing an electronic textbook about spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and web-site construction is estimated to be $150,000.
Variable processing costs are estimated to be $7 per book. The publisher plans to sell single-user access to the book for $49.
Through a series of web-based experiments, Eastman has created a predictive model that estimates demand as a function of price. The predictive model is demand = 4,000 - 6p, where p is the price of the e-book.
(a) Build a spreadsheet model to calculate the profit/loss for a given demand. What is the demand?
(b) Use Goal Seek to calculate the price that results in breakeven. If required, round your answer to two decimal places.
(c) Use a data table that varies price from $50 to $400 in increments of $25 to find the price that maximizes profit.
If Eastman sells the single-user access to the electronic book at a price of S
it will earn a maximum profit of $
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