Ava plans to open a candy shop called Sweet Life Candy. She can rent a shop space for $4,500 a month. She is or to keep the existing standard lights and wall paint in the shop. If she hangs wallpaper and neon lights, she w space. The interest on the loan to buy the wall prints and neon lights would cost her $700 per month, but the fu additional $1,000 per month in profit from candy sales. The building owner realises that, if Ava hangs wallpaper and neon lights, he can increase the rent to $5,000 per and neon lights if she moves to another building. To maximise her profit, Ava will 

A. Buy the wallpaper and neon lights, which avoids the builder owner's hold-up problem. 

O B. Buy the wallpaper and neon lights, which also maximises the total profit to Ava and the building owner. 

C. Keep the existing lights and wall paint, which avoids the builder owner's hold-up problem. 

D. Choose not to start the candy shop. 

O E. Keep the existing lights and wall paint, which also maximiser the total profit

Answer rating: 100% (QA)

To determine the best course of action for Ava to maximize her profit we need to consider the costs ... View the full answer