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On Dolph and Evan started the DE Restaurant in 2015. They rented a building, bought equipment. and hired two employees to work full time at

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On Dolph and Evan started the DE Restaurant in 2015. They rented a building, bought equipment. and hired two employees to work full time at a fixed monthly salary. Utilities and other operating charges remain fairly constant during each month. During the past two years, the business has grown with average sales increasing 1% a month. This situation pleases both Dolph and Evan, but they do not understand how sales can grow by 1% a month white profits are increasing at an even faster pace. They are afraid that one day they will wake up to increasing sales but decreasing profits. Required: Explain why the profits have increased at a faster rate than sales. Use the terms variable costs and fixed costs in your response

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