Trisha's Fashion Boutique Is Considering a Profit Sharing Arrangement with Her

Trisha's Fashion Boutique is considering a profit sharing arrangement with her employees.Currently,the employees receive an annual bonus.In a "Boom" market,Trisha can sell all the output she produces for $225 per unit.In a "Bust" market,Trisha can sell all the output she produces for $125 per unit.The probability of a "Boom" market is 75% and the probability of a bust market is 25%.Trisha's total cost function (including bonus payments to employees)is:
TC(Q)= 75Q + 2.5Q².The marginal cost function is: MC(Q)= 75 + 5Q.The profit sharing plan would pay employees 30% of profits.However,due to greater cost saving initiatives from employees,Trisha's total cost function becomes: TC(Q)= 505Q + 2Q².The relevant marginal cost function becomes: MC(Q)= 50 + 4Q.Which plan offers Trisha the greatest expected profits for herself? Suppose the employees will only approve a profit sharing plan if they are guaranteed their portion of profits will be at least $400.Will the employees approve of the profit sharing program?