Cool-Aire Corporation manufactures a line of room air conditioners. Its breakeven sales level is 33,000 units. Sales are approximately normally distributed. Expected sales next year are 40,000 units with a standard deviation of 4,000 units.
a. Determine the probability that Cool-Aire will incur an operating loss.
b. Determine the probability that Cool-Aire will operate above its break-even point.b. The firm's direct labor costs are increased as the result of a new labor contract.
c. The Occupational Safety and Health Administration (OSHA) requires the firm to install new ventilating equipment in its plant. (Assume that this action has no effect on worker productivity.)