Given the information below, answer questions from #9 to #10. The owner of Cheesecake Factory at the Forum Shop is renegotiating the operations lease and has the option of either (1) an annual fixed lease of $55,000 or (2) an annual fixed lease of $10,000 plus a variable lease set at 5% of annual revenue.

What is the indifference point?

A. $900,000

B. $1,100,000

C. $1,000,000

D. $1,300,000

Which option will cost less for the owner if annual revenue is expected to be $5,000,000?

A. Cannot be determined from the information given

B. The mixed lease (option 2)

C. The fixed lease (option 1)

D. Both options cost the same.