Sam Hutchins is planning to operate a specialty bagel sandwich kiosk but is undecided about whether to locate in the downtown shopping plaza or in a suburban shopping mall. Based on the following data, which location would you recommend? Location Downtown Suburban Annual rent, including utilities Expected annual demand (sandwiches) Average variable costs per sandwich Average selling price per sandwich $12,000 30,000 $1.50 $3.25 $8,000 25,000 $1.00 $2.85

Practical Management Science
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ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
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Sam Hutchins is planning to operate a specialty bagel sandwich kiosk but is undecided about whether to locate in the downtown shopping plaza or in a suburban shopping mall. Based on the following data, which location would you recommend?

Location Downtown Suburban

Annual rent, including utilities

Expected annual demand (sandwiches)

Average variable costs per sandwich

Average selling price per sandwich

$12,000

30,000

$1.50

$3.25

$8,000

25,000

$1.00

$2.85

 

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