Labor 2. Rosa is the manager of a fine-dining Italian restaurant in a large Midwest city....

 

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Labor 2. Rosa is the manager of a fine-dining Italian restaurant in a large Midwest city. She has experienced high turnover with her hourly employees over the past t several months because they say that she isn't paying competitive wages. More employees have threatened to leave if she doesn't give them a raise. She has determined that she can compete with local restaurants if she raises the hourly wage from $8.00 per hour to $8.50, a 6.25 percent increase. Rosa is concerned about what this will do to her labor cost percentage. Her current labor cost is 35 percent, and she feels that 38 percent is the highest labor cost ratio she can maintain and still make a profit. Using last month's data, help Rosa calculate the effect of a 6.25 percent increase in wages. Can she give the employees what they want and still make a profit? Original Cost Week of Labor Raise in Dollars Total Cost of Labor Labor Sales Cost % 1 $10,650 $27,600 2 12,075 32,250 3 10,887 28,650 4 10,383 37,200 Total 3. Jennifer operates Joe Bebe D Labor 2. Rosa is the manager of a fine-dining Italian restaurant in a large Midwest city. She has experienced high turnover with her hourly employees over the past t several months because they say that she isn't paying competitive wages. More employees have threatened to leave if she doesn't give them a raise. She has determined that she can compete with local restaurants if she raises the hourly wage from $8.00 per hour to $8.50, a 6.25 percent increase. Rosa is concerned about what this will do to her labor cost percentage. Her current labor cost is 35 percent, and she feels that 38 percent is the highest labor cost ratio she can maintain and still make a profit. Using last month's data, help Rosa calculate the effect of a 6.25 percent increase in wages. Can she give the employees what they want and still make a profit? Original Cost Week of Labor Raise in Dollars Total Cost of Labor Labor Sales Cost % 1 $10,650 $27,600 2 12,075 32,250 3 10,887 28,650 4 10,383 37,200 Total 3. Jennifer operates Joe Bebe D