Sadie owns a hair salon. She gives her hairdressers two options for using her facility, equipment, and salon products:

Option 1: they can pay Sadie $5 per haircut plus 20% of their revenue

Option 2: they can pay a flat chair rental of $1,000 per monthThe hairdressers charge their customers $40per haircut. The hairdressers incur no other expenses

At what point (number of haircuts per month) will the hairdressers be indifferent between the two payment options? A.25B.125C.77D.111E.193

Because of the poor economic outlook, the hairdressers expect that people will wait longer between haircuts and start cutting their kids hair, rather than bringing them in for a trim. If volume is expected to drop below the indifference point, which payment option will the hairdressers prefer?A. Option 1B. Option 2