Question: David Booth operates Booth Bootcamp Pty Ltd. David is a graduate of a sports and arecreation course, offers customised adventures for business groups wanting to
David Booth operates Booth Bootcamp Pty Ltd. David is a graduate of a sports and arecreation course, offers customised adventures for business groups wanting to develop their staff. Two clients have approached Booth Bootcamp Pty Ltd to run an adventure in the first week of April but David can run only one adventure at a time and has to choose which alternative will maximise profit. Both adventures will require a week of David’s time at a cost of $1100 and the use of the company’s specially fitted-out SUV at a cost of $2800. One client wants a rock climbing adventure for 10 people and will pay up to $860 per person. The cost per person for food and equipment is $180 and fixed setup costs are $2500. The other client wants a white water rafting adventure for 8 people and will pay up to $900 per person. David estimates the cost per person for food and equipment is $170 and the fixed setup costs are $2500.
Required
Using only the differential income and expenses determine which adventure David should provide.
Step by Step Solution
3.50 Rating (167 Votes )
There are 3 Steps involved in it
The cost of Davids time 1100 and the cost of the SUV 2800 ... View full answer
Get step-by-step solutions from verified subject matter experts
