Essay
The owner of Fat Man's Sausage Cart is concerned because the stand has been averaging only 5,500 sausage sales per month,the stand and staff can make 7,000 sausage on a bun per month.The variable cost of each sausage ( buns,meat etc)is $3.50.Monthly fixed costs are ( taxes,licenses,space rent and salaries)are $10,000.The owner (Big Bob)believes he could sell 7,000 sausages per month if he cuts the sales price from $7.50 to $7.00 per sausage.How much extra profit ( above the current level)would he generate if he decreased the sales price?
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New profit = (7,000 × $7.00)- ...View Answer
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