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You company sells inflatable suitcases that get bigger or smaller depending on the amount of clothing inside them. Each suitcase costs $40 to manufacture, and
You company sells inflatable suitcases that get bigger or smaller depending on the amount of clothing inside them. Each suitcase costs $40 to manufacture, and you sell them for an average of $110 per unit. It costs $5,000 per day to operate your factory (which is your only fixed cost).
Noted travel writer Angelina Kumars has offered to endorse your suitcase for $36,500 per year ($100/day). You believe that, with Ms. Kumars' endorsement, you will sell an average of 120 units per day.
Do you recommend that the company hire Ms. Kumars?
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