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In the year 2022 , EPH sold 20,000 sets of meals (including beverages) with an average cover price of 25. Variable food and drink average
In the year 2022 , EPH sold 20,000 sets of meals (including beverages) with an average cover price of 25. Variable food and drink average cost 5 per set. All other remaining costs can be viewed as fixed as they cannot be spread based on the set of meals sold. Required You are explicitly required to answer the following questions in a written format: 1) What is EPH's current breakeven point? (2 marks) 2) If the volume of the sales were to increase by 15 percent, by how much would EPH's profit increase? Please briefly comment. (6 marks) 3) If the volume of sales is raised and the revenue figure increases to 600,000, what would be the impact on profit? Please briefly comment. (6 marks) 4) If EPH increased average menu prices by 10 percent, with the same level of quantity sold, what would EPH's profit be? Please briefly comment. (6 marks) 5) Demonstrate professionally why Dan cannot use price discrimination (All the information available are given in the case scenario above). (10 marks) 6) Demonstrate professionally the role of budget to Dan. (10 marks)
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