Situation: You are the owner of a mini café that sells three main products: coffee, pastries, and sandwiches. You want to analyze your business's financial performance and strategize to maximize profit. Product Information: Coffee: Costs Php 55 per cup to produce; sold at Php 65 per cup. Pastries: Costs Php 4.50 each to produce; sold at Php 7 each. Sandwiches: Costs Php 17.50 each to produce; sold at Php 20 each. Fixed Costs: Monthly rent and utilities: Php 2,500 Monthly salaries: Php 8,000/employee (2 employees) Projected Sales (per monthly): Coffee: 1,500 cups Pastries: 1,200 pieces Sandwiches: 750 pieces Market Change: Due to local event, the demand for coffee increases by 25% while the demand for pastries decreases by 18%. To attract more customers, you decide to reduce the price of sandwiches to Php 19.
Situation: You are the owner of a mini café that sells three main products: coffee, pastries, and sandwiches. You want to analyze your business's financial performance and strategize to maximize profit. Product Information: Coffee: Costs Php 55 per cup to produce; sold at Php 65 per cup. Pastries: Costs Php 4.50 each to produce; sold at Php 7 each. Sandwiches: Costs Php 17.50 each to produce; sold at Php 20 each. Fixed Costs: Monthly rent and utilities: Php 2,500 Monthly salaries: Php 8,000/employee (2 employees) Projected Sales (per monthly): Coffee: 1,500 cups Pastries: 1,200 pieces Sandwiches: 750 pieces Market Change: Due to local event, the demand for coffee increases by 25% while the demand for pastries decreases by 18%. To attract more customers, you decide to reduce the price of sandwiches to Php 19.
Chapter7: Systems Of Equations And Inequalities
Section7.1: Systems Of Linear Equations: Two Variables
Problem 2SE: If you are performing a break-even analysis for a business and their cost and revenue equations are...
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Question
Here’s the tasks to do:
1. Calculate the total cost of production for each product and the total fixed costs for the month.
2. Compute the total revenue for each product before and after the market change.
3. Determine the profit or loss for the café both before and after the market change.
4. Calculate the break-even point for the café as a whole, in terms of total revenue needed to cover costs.
5. Based on your findings, answer the following questions:
a. Which product contributes the most to your profit?
b. Is lowering the price of sandwiches an effective strategy? Why or why not?
c. What changes would you suggest to increase overall profitability?
Transcribed Image Text:Situation: You are the owner of a mini café that
sells three main products: coffee, pastries, and
sandwiches. You want to analyze your
business's financial performance and strategize
to maximize profit.
Product Information:
Coffee: Costs Php 55 per cup to produce; sold
at Php 65 per cup.
Pastries: Costs Php 4.50 each to produce; sold
at Php 7 each.
Sandwiches: Costs Php 17.50 each to produce;
sold at Php 20 each.
Fixed Costs:
Monthly rent and utilities: Php 2,500
Monthly salaries: Php 8,000/employee (2
employees)
Transcribed Image Text:Projected Sales (per monthly):
Coffee: 1,500 cups
Pastries: 1,200 pieces
Sandwiches: 750 pieces
Market Change:
Due to local event, the demand for coffee
increases by 25% while the demand for pastries
decreases by 18%. To attract more customers,
you decide to reduce the price of sandwiches to
Php 19.
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