X Your answer is incorrect. You own a construction company. You have been offered two different jobs, but they both must be done in the next month and they would both take all of your workers to complete within that time. The first job is to build a restaurant, and the second is to build a clothing retail store. The restaurant will bring in revenue of $2.2 million, and the clothing store will bring in revenue of $1.8 million. It will cost your company $1.4 million to build the restaurant and $1.1 million to build the clothing store. Equipment rental would be $200,000 for both jobs. What is your incremental profit for the month if you choose to build the restaurant? $800,000 $600,000 $700,000 $100,000 Solution Your company can only select one of these projects, so it is important to examine which will earn the most profit to decide. In this case, the restaurant will bring in $2.2 million in revenue with $1.4 million in additional costs, so $800,000. The clothing store will generate $1.8 million in revenue with $1.1 million in additional costs, $700,000. The incremental profit is $800,000-$700,000= $100,000. The equipment rental does not need to be considered since it is the same for either project. CONTINUE
