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Question 1. 10 marks Maple Ltd. is a leader in the production of personal computers. However, the management has recently decided to produce smart 10K TVs. With the fast development of this technology, the product will have a short life cycle of 2500 units until new improvements come into production. Famous analyst Damir Qu estimated that the first 1500 units will be sold for $3700, and then the retail price will decrease as the product will reach the decline stage of its life cycle. Maple Ltd. assumes that the demand will be satisfied by the corporate clients who buy TVs in batches. Thus, the product will be produced and sold in batches of 10 units. Damir Qu estimated that fixed costs are equal to $320 000, workers will receive 20% higher than the average rate, which is currently $25 per hour other variable costs are $15 000 per batch. We may assume that costs will apply throughout the product's life. It will take 300 labour hours to produce the first batch of TVs. The learning index for a 90%- learning curve is -0.152. The 90%-learning curve will continue until 150 batches have been produced. After that, every batch produced above this level will take the same amount of labour time as the 150th batch. Damir Qu reaches you and asks your professional advice regarding the following questions: 1. What is the labour time taken to produce the 150th batch? (3 marks) 2. If the company plans to earn $2 900 000 from those 10K TVs, what is the selling price of the final 1000 units? (7 marks)

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