Abby Is Looking to Expand Her Pet Grooming Business and Wants

Multiple Choice

Abby is looking to expand her pet grooming business and wants to evaluate the profitability of a potential new market. The area she is looking at has 2,000 homes and Abby estimates that 20 percent of them would be likely to use her service. She charges $45 per grooming and on average customers groom their pets six times a year. Abby estimates her variable costs to expand her business will be $10 per grooming and her fixed costs are $10,000. How much profit would Abby make on this new segment?

A) $72,240
B) $98,000
C) $108,000
D) $128,000
E) $410,000