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Please help me solve the following. The Bart Soda Company is owned by the Homer Simpson Megaplex. Bart has the following information: production 100,000 gallons
Please help me solve the following.
The Bart Soda Company is owned by the Homer Simpson Megaplex. Bart has the following information: production 100,000 gallons per month variable costs $0.80 per gallon Currently making and selling 75000 gallons to Sloppy Joe's restaurant for $3.00 per gallon Situation 1: The Homer Simpson Megaplex has just acquired the Messy Sue's Diner and they use 20,000 gallons of soda every month Messy Sue's Diner had been buying soda from Moe's Tavern for $2.25 per gallon Since Homer's sister Jessica is unavailable due to being out in space, He has asked your advice. a) Should Messy Sue's continue to buy soda from Moe's Tavern or from Bart? b) If from Bart what price should the transfer be? (Homer wants to maximize his profits) c) how should Homer evaluate Bart and Messy Sue?
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