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Breakeven capacity analysis

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Hello,

I have modest familiarity with the simple break even analysis. However, the new slant in the current class are the elements of production rates, best price, and sensitivity of profits within the break even analysis. It is safe to say that right now I am a little overwhelmed!

My primary interest is in what pitfalls to watch out for in developing the answers for the attached problem based on the introduction of these new elements (production rates, best price, sensitivity of profits).

As a secondary interest, because my familiarity with Excel is limited, are there any recommended templates for setting up this type of analysis?

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Solution Summary

The expert provides a breakeven capacity analysis.

Solution provided by:
Gaurav Agarwal, MS
Education
  • BE, Bangalore University, India
  • MS, University of Wisconsin-Madison
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  • "Thank you, this helped a lot. I was not sure how to plug in those numbers to a formula. This was a great help. Now I have to figure out how to explain cost of capital is used in net present value analysis, and how cost of capital is used in net present value analysis. This stuff gets confusing."
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