The Study Of Marginal Analysis And Decision For Auto Parts Project

This paper is originated at practice during I was General Manager of Codan Lingyun Automotive Rubber Hose Co., Ltd, while I took business decision time to time, also I refer to the knowledge of Micro Economics, and the characteristics of auto parts industry.At presence, the theory of Marginal cost analysis and mathematic business decision was very rich, but the actual business case was limited, The theory has to be live with practice, then it will generate great productivity, This paper is not going to develop a new theory, It's purpose of helping middle and small size of auto part manufacturer, who has a lot of projects, I try to suggest them new way on how to analyze those projects and the way how to make right cost analysis, as well as the right business decision based on those analysis, so it can help growing business.This Paper is consists of 3 parts, the first part includes first and second chapters, which mainly introduce background and theory system which will be used in this article, They are: 1) The characteristics and trend of China auto part industry. 2) Marginal cost system and the connection with accounting knowledge. 3) Business decision model of Marginal cost analysis and regulated. The second part includes third and fourth chapters, which mainly talk about a real business case, There has two different way to make project cost analysis, after comparing the results of different decision model, we can prove that Marginal cost analysis will be much useful to auto part enterprise, the same time, a detailed introduction of how to make analysis and decision is given, The third part includes fifth and sixth chapters, which extends the decision model to business with economics of scale, specially for auto part industry.The major contribution of this paper is to introduce marginal cost analysis to auto parts enterprise. The creative point is regulating business decision with Marginal cost analysis.