C) I will be creating a hypothetical business model for a company that produces and sells tea. The company will be called Boston Tea Company (BTC).
Boston Tea Company is an American tea company that was founded at the end of 1773, a day after the Boston Tea Party, when its founder ran off with a few boxes of tea as opposed to throwing them into Boston Harbor. BTC sells different varieties of tea to the tea drinkers of America. They mostly sell tea to older people, however are looking into penetrating the market of younger Americans to have them drinking tea instead of coffee.
1- Fixed costs for BTC are warehouse rent ($5,000/month), utilities($1,000/month), salaries to executive employees ($10,000/month) and Guard dog up keep ($500/month)
2- Variable costs- tea purchases ($10 per pound).
3- Tea sells for $25 a pound.
4- Cost function= 10q+ 16,500
5- Revenue function- R(q)= 25q
6- Profit function = P(q)= 25q- 10q+16,500
7- The break even point is- 1,100 units and $27,500
8-
Hi Jordan, your hypothetical company is a really creative idea, especially its synopsis!
ReplyDeleteI really like your idea for a hypothetical company, and the synopsis is really funny.
ReplyDeletejordan,
ReplyDeletei like your business idea and i especially like that you included the need for a guard dog in your fixed costs! hehe. you organized your info well, but i don't see any graphs and you are missing a significant portion of the assignment. =/ i would have liked to have seen you complete it!
professor little