Essay
The owner of Willy's Wonderful Burger Stand is concerned because the stand has been averaging only 3,000 burger sales per month, the stand and staff can make 6,000 burgers per month. The variable cost of each burger (buns, meat, etc.) is $2.50. Monthly fixed costs are (taxes, licenses, space rent and salaries) are $7,500. The owner (Willy Wonderful) believes he could sell 5,000 burgers per month if he cuts the sales price from $5.00 to $4.75 per burger. How much extra profit (above the current level) would he generate if he decreased the sales price?
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New profit = (5,000 × $4.75) -...View Answer
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