TOPIC: MANAGERIAL ECONOMICS

Suppose that you are the manager of a studio cafe, and you are planning to invest on a new camera and a coffee maker designed to increase the productivity of your employees and output (services) produced. Your analyst provided you the following information:

A. Complete the table below. Current Projected Sales Incremental Situation and Profit Revenues and Costs Total Revenue Php 1,500,000 Php 1,800,000 Variable Cost 575,000 425,000 Direct Fixed Costs 625,000 700,000 Indirect Fixed Costs 100,000 100,000 Profit B. Should the new camera and coffee maker be purchased? Explain your answer based on the incremental analysis