Sherrell Washington owns a successful hole-in-the-wall bagel shop called Big Apple Bagels.Sherrell wants to expand the shop by leasing the space next door for $500 per month,and adding tables and chairs so that customers can dine in.She figures that the tables and chairs will cost $4,000 and that the bagel machine,that cost $3,500 five years ago,would have to be scrapped in favor of a larger machine costing $6,400.She thinks sales would increase by $4,000 per month.Variable costs are 50% of sales.

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The Answer of Sherrell Washington owns a successful hole-in-the-wall bagel shop called Big Apple Bagels.Sherrell wants to expand the shop by leasing the space next door for $500 per month,and adding tables and chairs so that customers can dine in.She figures that the tables and chairs will cost $4,000 and that the bagel machine,that cost $3,500 five years ago,would have to be scrapped in favor of a larger machine costing $6,400.She thinks sales would increase by $4,000 per month.Variable costs are 50% of sales.

Sherrell Washington Owns a Successful Hole-In-The-Wall Bagel Shop Called Big