Question
Chop's Lettuce currently sells 60,000 heads of lettuce each year for $1.00 per head. Chop's is thinking of expanding operations and serving the customer better
Chop's Lettuce currently sells 60,000 heads of lettuce each year for $1.00 per head. Chop's is thinking of expanding operations and serving the customer better by purchasing a "slice and dice" machine that will cut up each head of lettuce into bite-size pieces that can be used for salads. Chop's expects he will then be able to sell his lettuce for $1.70 per head. Chop's has prepared the following analysis for each option based on sales of 60,000 heads of lettuce: Based on the information above, what will be Chop's increase or decrease in profit for the year if he chooses to start slicing up the lettuce instead of selling it whole?
Select one:
a. $3,000 increase
b. $3,000 decrease
c. $12,000 decrease
d. $30,000 increase
Chop's Lettuce currently sells 60,000 heads of lettuce each year for $1.00 per head. Chop's is thinking of expanding operations and serving the customer better by purchasing a "slice and dice" machine that will cut up each head of lettuce into bite-size pieces that can be used for salads. Chop's expects he will then be able to sell his lettuce for $1.70 per head. Chop's has prepared the following analysis for each option based on sales of 60,000 heads of lettuce:Based on the information above, what will be Chop's increase or decrease in profit for the year if he chooses to start slicing up the lettuce instead of selling it whole? Select one: a. $3,000 increase b. $3,000 decrease c. $12,000 decrease d. $30,000 increaseStep by Step Solution
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