1) Using the information in the table below determine whether or not Basin Insurance Limited should hire three insurance agents using Incremental Method.

Data for Q.1:

Each agent is paid $75,000.

T

otal estimated revenue with the number of reps shown is as follows:

1 rep: $150,000

2 reps: $200,000

3 reps: $300,000

Total estimated profit with the number of reps is as follows:

1 rep: $75,000

2 reps: $175,000

3 reps: $225,000