OK, forget about the above change to the cost of Jan-Apr internships. Suppose instead that the full cost of a May-Aug internship decreases by $2,396.

What is the new total cost of this model?

Hint: you should be able to answer this question using the sensitivity report.

Question

OK, forget about the above change to the cost of Jan-Apr internships. Suppose instead that the full cost of a May-Aug internship decreases by $2,396.

What is the new total cost of this model?

Hint: you should be able to answer this question using the sensitivity report.

BlackTom AI · Accepted Answer

First, restate what the problem is asking in my own words to make sure the goal is clear: we are told that the full cost of a May–Aug internship decreases by 2,396 dollars, and we need the new total cost of the model. There are no answer choices to evaluate.

Since there are no given multiple choices, we rely on the information you can pull from the sensitivity report (as the hint suggests). The sensitivity report typically shows how changes in input costs affect the model’s outputs, including the total cost.

Step 1: Identify the baseline total cost for the model as reported before any change. This would be the total cost with the original May–Aug internship cost (i.e., prior to applying the -2,396 adjustment).

Step 2: Locate the May–Aug internship cost within the sensitivity report. You want the component that corresponds to that period or category of internships.

Step 3: Apply the change to the cost. Since the problem states the full cost decreases by 2,396, subtract 2,396 from the original May–Aug internship cost component.

Step 4: Recompute the model’s total cost. After adjusting the May–Aug cost by -2,396, add up all cost components again to obtain the new total. If the sensitivity report provides a total effect or a direct total column for the scenario with a -2,396 change, you can read the new total directly from there.

Step 5: If you’re unsure whether the total is shown instead of the component, verify by summing individual components after the change: new May–Aug cost = original May–Aug cost − 2,396, then new total = (sum of all other costs) + (new May–Aug cost).

Common pitfalls to avoid:
- Don’t double-count the change: only the May–Aug cost should be adjusted by −2,396.
- Make sure you’re updating the full cost (not a per-internship cost) if the report differentiates between per-unit and total costs.
- If the sensitivity report presents only the total change impact rather than the exact new total, you can apply the reported total change (−2,396) to the baseline total to obtain the new total.

In short, you should take the baseline total cost from the model, subtract 2,396 from the May–Aug cost component, and then sum the components again (or read the total directly if provided) to get the new total cost.

COMM_V 190 101-104 2025W1 FlexHW14.COMM190.2025.W1 (optional — see syllabus)

OK, forget about the above change to the cost of Jan-Apr internships. Suppose instead that the full cost of a May-Aug internship decreases by $2,396. What is the new total cost of this model? Hint: you should be able to answer this question using the sensitivity report.

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