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Mark's Bistro plans a weekend discount where the price of lasagna drops from $10.00 to $8.00. Promotion costs $700. Mark expects lasagna sales to increase
Mark's Bistro plans a weekend discount where the price of lasagna drops from $10.00 to $8.00. Promotion costs $700. Mark expects lasagna sales to increase by 30%, but sales of salads may decrease by 10%. Weekly data are:
- Lasagna: Sales Price: $10.00, Variable Costs: $5.00, Sales Volume: 400
- Salads: Sales Price: $5.00, Variable Costs: $2.50, Sales Volume: 600
Requirement: Evaluate the potential impact on profits and provide a recommendation.
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