Econ3040 Small Class Project Summer 2011 We are going to use the Pool Vac case to conduct a mini-project for class. We will use part of one class and…

Econ3040Small Class ProjectSummer 2011We are going to use the Pool Vac case to conduct a mini-project for class. We will use part of one class and all of next week’s labs to work specifically on the project. If you believe that you need additional time, I can try to make arrangements to get a computer lab next Monday.Assume that you work for the WKIA (We Know It All) Consulting Firm. Pool Vac has come to you to find out several things about its production process and demand. You will write a report of approximately four pages to answer these questions (this would include your output but assume that any graphs would comprise additional pages. You may work alone or with one other person to complete this assignment. (If working with a partner, I will have greater expectations regarding writing & editing, and interpretation of output).The pdf file is included in this folder but I did copy it onto this WORD file. You can use the answers to develop your report, where you present to Pool Vac your recommendations for pricing. Along the way, you will present information about costs, elasticity, and predicted sales. Finally, you will see Question 8, which is MY question relating to forecasting. Please include information about the forecast from this method.I am letting the organization of your report to be your choice (although I do expect an introduction and concluding paragraph). Think about what information will be important to your client. In addition to your final report, attach your answers to the questions from the case.This assignment is worth 15% of your grade. I have high expectations from you because you have a group a good writers with good technical skills. (I’m actually looking forward to grading your assignment!)CONSULTING PROJECTPricing and Production Decisions at PoolVac, Inc. PoolVac, Inc. manufactures and sells a single product called the “Sting Ray,” which is a patent-protected automatic cleaning device for swimming pools. PoolVac’s Sting Ray accounts for 65 percent of total industry sales of automatic pool cleaners. Its closest competitor, Howard Industries, sells a competing pool cleaner that has captured about 18 percent of the market. Six other very small firms share the rest of the industry’s sales. Using the last 26 months of production and cost data, PoolVac wishes to estimate its unit variable costs using the following quadratic specification: