b) If everything else remains unchanged, find the minimum units of Mazagran to be sold to ensure that the total productivity becomes higher than its current level. (7 marks)

The Adelaide Sibling coffee shop sells Latte, Espresso, and Mocha coffee. Currently the labour cost is $320/day. In addition, the equipment cost is $125/day and the overhead cost is $225/day. The table shows the demands/day, selling price and material costs for each coffee. Latte Coffee Espresso Mocha Coffee Beverage Sold 350 100 150 Price per beverage $2.00 $3.00 $4.00 Material($) per $0.50 $0.75 $1.25 beverage The owner of the Coffee Shop wants to know how the shop's productivity would be changed by adding Mazagran. He expects that Mazagran will bring in new customers and will not affect current demand. It is estimated that the new equipment cost is $200/day, and the new overhead cost is $350/day. The labour cost/day would not be changed. Assuming that the new equipment is purchased before Mazagran is added to the menu, he has developed new average daily demand and cost projection. The table in the below presents the new demands/day, as well as selling price and material costs per coffee for the new product line. Latte Coffee Espresso Mocha Coffee Mazagran Beverage Sold 350 100 150 75 Price per beverage $2.00 $3.00 $4.00 $5.00 Material($)per $0.50 $0.75 $1.25 $1.50 beverage a) Calculate the change in both labour productivity and total productivity if Mazagran is added to the m Note that for labour productivity, the cost should include labour, equipment and overhead cost. (3 Parks To TOP