Total Quality Management Costs are often identified and categorized in the Prevention,
Appraisal, Failure (PAF) Model.
a. With relevant examples, explain the components of the PAF- model
b. According to the PAF- Model in which ways can organizations minimize the total
cost (TC) of quality?
c. Briefly explain the term Benchmarking. Distinguish between the three types of benchmarking

Contribution Margin approach

Problem: Consider the following situation independently. Fill in the blanks with the appropriate information.

Contents »

X Company has the following data from 2016 and 2017:

Expected production in 2018 is 43,800 units. Using the high-low method with the 2016 and 2017 data to determine the parameters of the cost function, what are estimated total costs in 2018?

All questions below rely on the following assumptions:

? = 20-0.25?
?? = 8 = Average Cost

a)What is the profit maximizing P and Q for the two‐firm Cournot oligopoly? And what is the total profit?

b)Assume that are three firms with equal Qs in this Cournot oligopoly. What is the industry P and Q at the profit maximizing equilibrium? And what is the total profit?

Suppose in Jack’s production function, capital and labor are perfectly substitutable such that q = K + L. Assuming, as we have all term, that the wage rate is w and r is the rental rate of capital, find Jack’s long-run total cost function representing Jacks’ total costs in terms of output, TC(q) = C(q)

[The following information applies to the questions displayed below.]

Vista Electronics, Inc. manufactures two different types of coils used in electric motors. In the fall of the current year, Erica Becker, the controller, compiled the following data.

Sales forecast for 20x0 (all units to be shipped in 20x0):

Raw-material prices and inventory levels:

Use of raw material:

Direct-labor requirements and rates:

Finished-goods inventories (in units):

Production overhead:

A. Prepare the sales budget (in dollars) for 20x0.

B. Prepare the production budget (in units) for 20x0.

C. Prepare the raw material purchases budget (in quantities) for 20x0.

D. Prepare the raw material purchases budget (in dollars) for 20x0.

E. Prepare the direct-labor budget (in dollars) for 20x0.

F. Prepare the production-overhead budget (in dollars) for 20x0. (Round "Cost Driver Rate" to 2 decimal places.)

Over the past several years, decommissioned U.S. warships have been turned into artificial reefs in the ocean by towing them out to sea and sinking them. The thinking was that sinking the ship would conveniently dispose of it while providing an artificial reef environment for aquatic life. In reality, some of the sunken ships have released toxins into the ocean and have been costly to decontaminate. In the late 1990s, at least two international conventions have made it all but impossible to export used warships for salvage without removing all military equipment, conducting a complete cleanup and cutting the ship into such comparatively small pieces as to make the entire exercise relatively expensive.

The new environmental regulations have made disposal of ships an expensive project. The United States has hundreds of mothballed warships, presenting an extremely expensive problem for military authorities and the government. Now the U.S. government is taking bids to instead dismantle and recycle ships that have recently been decommissioned (but have not been sunk yet.)

Assume that a recently decommissioned aircraft carrier, the USS Blaze, is estimated to contain 40 tons of recyclable materials able to be sold for approximately $32.8 million. About 90% of the value in old ships is the metals, including steel, copper, copper alloys, and lead that can be removed, sold for remelting, and reformed into new metal products. There are also some high-value metals; such as, nickel alloys, stainless steel, and titanium that can be found in some parts of all warships but may be present is such small quantities that recovery and resale may not be cost effective. The low bid for dismantling and transporting the ship materials to appropriate facilities is $34.5 million. Recycling and dismantling the ship would create about 500 jobs for about a year on the West Coast area. This geographic area has been experiencing record-high unemployment rates in recent years.

As an alternative, reefing these ships would create new habitats for underwater life and can be done using newer environmentally safe methods. These new artificial reefs would enhance fishery resources and facilitate the access and utilization by recreational and commercial fishermen. Artificial reefs can also increase tourism by attracting sport divers for recreational purposes. Academic organizations may be interested in using the site to study fish and other marine life which may open the door for more funding from these research activities. Research has shown that a new reef will attract 60,000 – 70,000 divers and add more than 10 million to the local tourism industry. Research has also shown that artificial reefs can substantially increase the population of reef-associated species. Within months the G. B. Church artificial reef in British Columbia had hundreds of encrusted individuals on its hull and within 2.5 years had seen an increase of nearly 100 species.

Reefing the ship would cost an estimated 800K (or $0.8 million) which includes cleaning of the vessel of toxics, oils and greases, PCB containing electrical and electronic equipment and other readily removable PCB containing equipment, local towing and docking, preparation (unspecified) and other incidental overhead items, insurance, and making the vessels safe for divers (diverizing). There will also be yearly maintenance costs in perpetuity.

Is it more financially advantageous to sink the ship or to dismantle and recycle it? Show your calculations. (Worth 4 pts.)

Remember that great app you wrote for Yogurt Yummies (Lab 10-2). They want you to enhance the C++ console application that calculates and displays the cost of a customer’s yogurt purchase. Now they need to process multiple sales. Do not change any logic for handling a single sale. Make the following enhancements:

          ● Add "v2" to the application output header and close.

          ● Declare and initialize overall totals including:

                    ü Number of sales.

                    ü Overall number of yogurts sold.

                    ü Overall sale amount after discount.

                    ü Overall tax paid.

                    ü Overall sale total.

          ● Enclose the logic for a single sale with a sentinel loop that continues to process sales until the user enters 'n'.

          ● After calculating sale totals, update overall totals.

          ● When the user enters the sentinel value ('n'), print overall totals using formatted output manipulators (setw, left/right). Run the program with invalid and valid inputs, and at least three sales. The output should look like this:

Welcome to Yogurt Yummies, v2

-----------------------------

Enter another yogurt purchase (y/n)? y

Sale 1

----------------------------------------

Enter the number of yogurts purchased (1-9): 11

Error: '11' is an invalid number of yogurts.

Enter the number of yogurts purchased (1-9): 2

Enter the percentage discount (0-20): 22

Error: '22.00' is an invalid percentage discount.

Enter the percentage discount (0-20): 4

Yogurts:                             2

Yogurt cost ($):                  3.50

Discount (%):                     4.00

Subtotal ($):                     7.00

Total after discount ($):         6.72

Tax ($):                          0.40

Total ($):                        7.12

Enter another yogurt purchase (y/n)? y

Sale 2

----------------------------------------

Enter the number of yogurts purchased (1-9): 5

Enter the percentage discount (0-20): 10

Yogurts:                             5

Yogurt cost ($):                  3.50

Discount (%):                    10.00

Subtotal ($):                    17.50

Total after discount ($):        15.75

Tax ($):                          0.94

Total ($):                       16.70

Enter another yogurt purchase (y/n)? y

Sale 3

----------------------------------------

Enter the number of yogurts purchased (1-9): 7

Enter the percentage discount (0-20): 20

Yogurts:                             7

Yogurt cost ($):                  3.50

Discount (%):                    20.00

Subtotal ($):                    24.50

Total after discount ($):        19.60

Tax ($):                          1.18

Total ($):                       20.78

Enter another yogurt purchase (y/n)? n

Overall totals

========================================

Sales:                               3

Yogurts:                            14

Total after discount ($):        42.07

Tax ($):                          2.52

Total ($):                       44.59

End of Yogurt Yummies, v2

This is from yogurt Yummies V1

Welcome to Yogurt Yummies

-------------------------

Enter the number of yogurts purchased (1-9): 12

Error: '12' is an invalid number of yogurts.

Enter the number of yogurts purchased (1-9): 4

Enter the percentage discount (0-20): 30

Error: '30.00' is an invalid percentage discount.

Enter the percentage discount (0-20): 10

Yogurts:                             4

Yogurt cost ($):                  3.50

Discount (%):                    10.00

Subtotal ($):                    14.00

Total after discount ($):        12.60

Tax ($):                          0.76

Total ($):                       13.36

End of Yogurt Yummies

Consider the following hourly demand and cost schedule for a firm facing a fixed price of $ 6.00 per unit. (Tπ, is Total Profit).

  Q    P             TR    MR    TFC       TVC          TC         MC           ATC          AVC         Tπ

  0    $6.00                                                               $2.00            

  1                                                           4              

  2                                                           6              

  3                                                           8             

  4                                                           11             

  5                                                           15                     

  6                                                          20             

7.                                                       26             

8                                                           33           

  9                                                           41           

10                                                       50

11                                                       60

1. Complete the columns for ATC, AVC, and MC as well as those for (TC), TVC, & TFC.  
2. Draw the curves for Demand, MR (Marginal Revenue), ATC, AVC, and MC, all in one diagram. Also draw the Total Revenue (TR), Total Cost (TC), TVC, and TFC in a second diagram right below the first one.

3. Determine, in order to maximize profit, how many units should this firm produce and why?
4. Calculate the total profit at the profit-maximizing level and demonstrate it graphically and geometrically in the diagrams wherever applicable.