Clary Corporation sells 2,000 units of product Y per day at $2 per unit. Clary has the option of processing the product further for additional costs of $1000 per day to produce Product Z, which sells for $2.90 per unit. If Clary processes product Y further into Product Z, the company's net income will:Select one:a. decrease by $1000 per dayb. increase by $800 per dayc. Increase by $1,800 per dayd. decrease by $800 per daqy

The correct answer is:

increase by $800 per day (b.)

Explanation:

The question is asking us to compare the incomes gotten by Clary if she sells 2000 units of the product as Y, or as Z and make an inference from the options given.

First of all, we will calculate the total income gotten when the product is sold as Y. This is calculated as follows;

Product as Y;

1 unit = $2

∴ 2,000 units = $4,000

Next let us calculate the income gotten from the product as Z;

Product as Z;

1 unit = $2.90

2,000 units = 2.90 × 2,000 = $5,800.

We are also told that in order to transform the product Y to Z, an additional cost of $1,000 was incurred, so to get the net income from Z, we will subtract this amount from the total income of Z;

Net income from Z = 5,800 - 1,000 = $4,800

Comparing the two incomes from Y and Z, we see that selling the product as Y brings an income of $4,000, while as Z, brings an income of $4,800, and the difference is $4,800 - $4,000 = $800. Since Clary processes the product from Y further to Z, the net income increase by $800 per day(b.)

a manufacturer of printed circuit boards uses exponential smoothing with trend to forecast monthly demand of its product. at the end of december, the company wishes to forecast sales for january. the estimate of trend through november has been 200 additional boards sold per month. average sales have been around 1000 units per month. the demand for december was 1100 units. the company uses α = 0.20 and β = 0.10. make a forecast including trend for the month of january.