Question: The owner of Genuine Subs Inc hopes to expand the

The owner of Genuine Subs, Inc., hopes to expand the present operation by adding one new outlet. She has studied three locations. Each would have the same labor and materials costs (food, serving containers, napkins, etc.) of $ 1.76 per sandwich. Sandwiches sell for $ 2.65 each in all locations. Rent and equipment costs would be $ 5,000 per month for location A, $ 5,500 per month for location B, and $ 5,800 per month for location C.
a. Determine the volume necessary at each location to realize a monthly profit of $ 10,000.
b. If expected sales at A, B, and C are 21,000 per month, 22,000 per month, and 23,000 per month, respectively, which location would yield the greatest profits?

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  • CreatedDecember 30, 2014
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