Business Calculus Essay Example

It is common to find a newspaper with articles about companies who have made a substantial financial loss due to derivative transactions went twisted. The use of derivatives is progressively becoming popular in the contemporary years as more companieslook for enhanced ways of managing financial and operating risks. Senior managers need to review and closely monitor the financial decisions formerly planned and implemented by specialists.

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2018 Dodge Grand Caravan is amongst the best-selling minivans in Canada. The analysis is based on the actual sales data concerning the sales for each month, and it will focus the sales of the product for July. The current design (2018) is the 10th model, but age does not mean the other models are viable. The Dodge Grand Caravan is a 283-horsepower and a 6- speed auto has excellent performance, comfortable and plenty of space for family/cargo hauler amongst the minivan category. The table below illustrates the number of sales made each month of the year in Canada, which is the leading buyer in the United States.

The price of the 2018 Dodge Grand Caravan is affected by many factors. Different consumers have a different color preference of a car especially ladies tend to prefer specific colors of vehicles which significantly affects the demand and price of the vehicle. The time of the year also dramatically impacts where the Dodge Grand Caravan can be sold better during the springs than autumn, waiting for a recovered season that is likely to reduce the car value through depreciation extra about the seasonal fluctuation which would increase the price. Other factors include the fuel consumption, technology, fuel comfort, reliability.2018 Dodge Grand Caravan significant competitors in the minivan category sales include 2018 Chrysler Pacifica, 2019 Honda Odyssey and 2018 Chrysler Pacifica Hybrid.

Discount strategies are essentially putting into consideration on the effects to profit margin and sales targets. Several sellers offer a variety ofdiscounts depending on the margin figure and breakeven figures concerning 2018 Dodge Grand Caravan to increase their sales volume and increase their profits. Nonetheless, it is important to understand customers and assess what type of offers will attract more sales to increase the number of orders. To establish the demand function, data used regarding the unit sales will include January to June sales as presented in the table below.

The demand function of the sales of 2018 is D(x) =28822 - 1.311x concerning the graph function of the resultant graph of sales from January to June. The elasticity of demand E(x), assume the value of the resultingin the demand function to be 1. Therefore the optimal price unit = 28822 - 1.311(1) = $28,820.689.

At the optimal price, the seller is making the maximum amount of profit through the sale of the product. When the price is below the optimal rate, the seller is moving more significant quantities of goods to be able to earn the highest aggregate profit. When the seller transfers the price above the optimal point, they are moving few units with a higher margin per unit and therefore achieves a lesser total profit. Thus, the ideal quantity unit price is $28,820.689to result in the perfect quantity sold. The resultant optimal price is above the amount that a unit sold. Hence, the demand function is not reliable, and it cannot be used as an ideal unit price per unit.