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The As-You-Like-It Hamburger Shop is considering adding a new location. The investment at each of the four potential sites is the same. The price they can charge for hamburgers is set by the competition in the area.   Given the information below, which site is expected to be the most profitable?   Factor Site A Site B Site C Site D Fixed Cost $10,000 $8,000 $6,000 $11,000 Variable Cost per Unit $    0.70 $  0.70 $  0.85 $    0.65 Price per Unit $    1.30 $  1.20 $  1.25 $    1.10 Forecast Volume (Units) 20,000 22,000 18,000 24,000

The As-You-Like-It Hamburger Shop is considering adding a new location. The investment at each of the four potential sites is the same. The price they can charge for hamburgers is set by the competition in the area.   Given the information below, which site is expected to be the most profitable?   Factor Site A Site B Site C Site D Fixed Cost $10,000 $8,000 $6,000 $11,000 Variable Cost per Unit $    0.70 $  0.70 $  0.85 $    0.65 Price per Unit $    1.30 $  1.20 $  1.25 $    1.10 Forecast Volume (Units) 20,000 22,000 18,000 24,000

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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The As-You-Like-It Hamburger Shop is considering adding a new location. The investment at each of the four potential sites is the same. The price they can charge for hamburgers is set by the competition in the area.

 

Given the information below, which site is expected to be the most profitable?

 

Factor

Site A

Site B

Site C

Site D

Fixed Cost

$10,000

$8,000

$6,000

$11,000

Variable Cost per Unit

$    0.70

$  0.70

$  0.85

$    0.65

Price per Unit

$    1.30

$  1.20

$  1.25

$    1.10

Forecast Volume (Units)

20,000

22,000

18,000

24,000
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