$1\mathrm{.}1$ Use analytical tools to comprehend, analyze, and critically evaluate complex and unstructured qualitative and quantitative business problems

A Dunkin shop in San Antonio, Texas sells the following variety of coffee with the following daily demand

Regular brew

Expresso

Cappuccino

Beverage sold

$450$

$250$

$350$

Price per beverage

$$1$

$$2\mathrm{.}50$

$$4$

Material cost per beverage

$$0\mathrm{.}50$

$$0\mathrm{.}75$

$$1\mathrm{.}50$

The location has daily labor costs of $$400\mathrm{.}00,$ daily equipment cost of $$150$ and overhead cost of $$300.$

Corporative offices has suggested that introducing a new coffee variety called Green coffee $($made using sustainable coffee and biodegradable cups$)$ will help compete with other brands, bring in new customers concerned about sustainability and not cannibalize current demand. It is estimated that a $100$ Green coffee will be sold daily with a price of $$5\mathrm{.}00$ and material cost of $$1\mathrm{.}50$ per unit. Assuming that the new equipment is purchased before the new product is added is added to the menu. The overall costs of this location will increase, with new equipment cost increasing to $$200($daily$),$ and new overhead cost increasing to $$350($daily$).$

Regular brew

Expresso

Cappuccino

Green coffee

Beverage sold

$450$

$250$

$350$

$100$

Price per beverage

$$1$

$$2\mathrm{.}50$

$$4$

$$5$

Material cost per beverage

$$0\mathrm{.}50$

$$0\mathrm{.}75$

$$1\mathrm{.}50$

$$1\mathrm{.}50$