(Answered) Calculating unit cost growth rate

Abby Lockheart, a quality control supervisor for Intensive care, Inc., is concerned about an increase in distribution costs per unit from $3 to $3.27 over the last three years. Lockheart feels that setting up a new direct-sales distribution network at a cost of $3.56 per unit may soon be desirable.;A. Calculate the unit cost growth rate using the constant rate of change model with continuous compounding.;B. Forecast when unit distribution costs will exceed the current cost of direct-sales distribution.
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Calculating unit cost growth rate

 


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