Improvement to batteries is constantly improving. A 20 k Wh battery $100.000. pu
ID: 387832 • Letter: I
Question
Improvement to batteries is constantly improving. A 20 k Wh battery $100.000. purchased 20 y ears ago at a cost of A) What will a 50 kWh ba ttery cost today if the power-sizing exponent is 0.57 and the cost index has increased from 180 to 200 over the last 20 years? ) When making the economic decision to replace the battery today. would you be concerned with your previous expenditure on the 20 k Wh battery? Explain. C) Determine the breakeven volume (number of units sold) for the 50 k Wh battery Fixed Cost $1.5 Billion Materials and Labor $95.000/unitExplanation / Answer
c. the break even volume= (fixed cost- selling price)/ variable cost per unit
fixed cost = ($10,000,000,000- 100,000)/ 95,000= 9,900,000,000/95000= 104,210 units
b. if I am going to replace the old one with new one, then I consider what is the cost of new battery, and is there any return from the old unit selling. what is the additional cost occurs to replace the battery and what are the additional benefits it provided for the function. and also consider the benefit i received from the old one and the cost on that unit.
a. if the cost index is increasing from 180 to 200, means the cost of production is increased from 1.8 times to 2 times than the price of the unit when compares to 20 years back. and the power capacity is increased by 57% than the old one.