$($Prepared from a situation suggested by Professor John W$.$ Hardy.$)$ Lone Star Meat Packers is a major processor of beef and other meat products. The company has a large amount of T$-$bone steak on hand and is deciding whether to sell the T$-$bone steaks as they are initially cut or process them further into filet mignon and the New York cut.

If the T$-$bone steaks are sold as initially cut, the company figures a $1-$pound T$-$bone steak yields the following profit:

Selling price $($ $$8\mathrm{.}40$ per pound$)$

Less joint costs incurred up to the split$-$off point where T$-$bone steak can be identified as a separate product

Profit per pound

$\backslash$table$[[$$$8\mathrm{.}40$