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Chad Runs a Coffee Shop That Has Annual Revenues of $300,000

Question 1

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Chad runs a coffee shop that has annual revenues of $300,000, supply costs of $60,000, and employee salaries of $60,000. He has the option of renting out the coffee shop for $80,000 per year, and he has three outside offers from competitors to work as a senior barista at Starbucks (for an annual salary of $30,000) , at Simon's coffee house (for an annual salary of $40,000) , and at Peet's coffee shop (for an annual salary of $60,000) . He can only hold one job at a time. What should Chad do?


A) He should rent out his coffee shop and take the job at Starbucks.
B) He should rent out his coffee shop and take the job at Simon's.
C) He should rent out his coffee shop and take the job at Peet's.
D) He should continue to run his coffee shop.

Correct Answer:

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