A deli sells sandwiches for $8.50 each, on average. Material costs are $2.25 per sandwich and fixed costs are $95 per hour including the cost of labor. The shop employs three workers, each of whom makes an entire sandwich and requires five minutes to process the entire order for each customer. Assuming labor costs are fixed and demand is 25 sandwiches per hour, how much profit does the shop make per hour, on average? Multiple Choice $212.50 $95.00 $61.25 $45.25

A deli sells sandwiches for $8.50 each, on average. Material costs are $2.25 per sandwich and fixed costs are $95 per hour including the cost of labor. The shop employs three workers, each of whom makes an entire sandwich and requires five minutes to process the entire order for each customer. Assuming labor costs are fixed and demand is 25 sandwiches per hour, how much profit does the shop make per hour, on average? Multiple Choice $212.50 $95.00 $61.25 $45.25

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter4: Extent (how Much) Decisions

Section: Chapter Questions

Problem 4.6IP

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