Dermaplus Analysis Essay

Based on a wet analysis of the data provided, this report provides elaborate with respect to the increase-maximizing comely insouciant deed faculty for DermaPlusTM for each mathematical reference- ground charge of $50, $100, and $150 per unit of measurement identify by the consultant. The estimated expected periodic take in at each toll impart also be provided. All unit and appeal values have been locomote to the nearest whole number or dollar.Information in terms of the recommended average periodical yield readiness in units for the next 12 months forget be provided in society to rigid the surface of the plants unionized workforce. The premise is the quantity of units identified used to mystify the size of the workforce will increase periodic profit.A summary and recommendations to steering will follow the analysis.Profit-Maximizing average out Daily production Capacity & expect ProfitBiomed operates in a short competitive market and has no breaker po int of mark checkting power. In this case of DermaPlusTM, the government sets the impairment of the product. In order to determine the profit maximizing make in the short-run for this market, each price level provided by the consultant essential be equal to the short-run borderline cost.Total profit is calculated from subtracting the unite total touch on and variable star cost from the total gross generated. Total be are derived from the fixed cost of $9,000 in addition to calculating the average variable cost formula provided by the reverse analysis multiplied by the increasing average daily production aptitude calculated at each price level.The regression analysis provided by Selwyn ground on the data collected is statistically significant greater than a 99% confidence level based on the p-value with a high correlation among the dependent and independent variables at 95%Refer to Appendix I for the expatiate calculations for profit-maximizing average daily product ion capacity and expected profit. scathe level = $50 per unitIf the government sets the price of DermaPlusTM at this level, BioMeds profit maximizing average daily production capacity is 342 units. At this level of make, total tax income generated is $17,100 per sidereal day. The total cost of producing this level of output based on total fixed and variable costs is $17,349. BioMed incurs a prejudice of $249 per day when the price is set at $50 per unit.If the price is set at $50 per unit by the government, BioMed should lock away continue to produce this product if production is set at 342 units. Based on the shutdown rule, BioMed can sell at a loss for the next twelve months as the selling price at $50 per unit is greater than the stripped average variable cost of $22.47. damage Level = $100 per unitThe profit-maximizing average daily production capacity at $100 per unit is 407 units. At this level of production, total revenue generated per day is equal to $40,700 with a tot al cost of $22,125. This level of daily production will yield a profit of $18,575.Price Level = $150 per unitAt $150 per unit, the profit-maximizing average daily production capacity is 456 units. Total revenue generated at this level is equal to $68,400 at a total cost of $28,210. A profit of $40,190 per day is achieved when pricing is set at this level.Recommended Average Daily Production Capacity 12 Months Based on Price UncertaintyThe recommended average daily production capacity will be calculated using the expected price based on the probability dispersal calculated by the outcome of the weight averages. According to the consultant, there is a 5% hap of price being set at $50, a 20% chance of the price being set at $100, and a 75% chance of the price being set at $150. As a result, the price expected (Pe) based on the information from the consultant is $ one hundred thirty-five per unit.At this expected price, the average daily production capacity should be set at 442 unit s generating at total revenue of $59,670 at a total cost of $26,219. At this level of production, profit should be maximized yielding a total profit of $33,451.