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Question 2 Not yet answered A restaurant wants to see whether its revenues and profits are increasing in real terms. The values of the Consumer
Question 2 Not yet answered A restaurant wants to see whether its revenues and profits are increasing in real terms. The values of the Consumer Price Index as of the end of each month, together with the monthly revenues and costs of the restaurant are given in the Table below. Marked out of 25.00 Index Revenue Cost P Flag question Jan. 2,192 253,800 103,800 Feb 2,413 257,905 120,900 Mar 2,618 275,000 138,900 Apr 3,477 277,900 177,300 May 3,789 282,000 185,000 3,861 295,000 187,700 Jun Jul 3,895 301,750 192, 100 Aug 4,001 295,600 199,500 a. Calculate the monthly rate of inflation if the index reflects the general price level in the economy. b. Convert the historic revenues and costs to current revenues and costs using the index. C. Comment on the trend of real revenues and costs during the six months analyzed and discuss the implications of this trend on profit margin. Question 2 Not yet answered A restaurant wants to see whether its revenues and profits are increasing in real terms. The values of the Consumer Price Index as of the end of each month, together with the monthly revenues and costs of the restaurant are given in the Table below. Marked out of 25.00 Index Revenue Cost P Flag question Jan. 2,192 253,800 103,800 Feb 2,413 257,905 120,900 Mar 2,618 275,000 138,900 Apr 3,477 277,900 177,300 May 3,789 282,000 185,000 3,861 295,000 187,700 Jun Jul 3,895 301,750 192, 100 Aug 4,001 295,600 199,500 a. Calculate the monthly rate of inflation if the index reflects the general price level in the economy. b. Convert the historic revenues and costs to current revenues and costs using the index. C. Comment on the trend of real revenues and costs during the six months analyzed and discuss the implications of this trend on profit margin
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