A young chef is considering opening his own sushi bar.To do so, he would have to quit his current job, which pays $20, 000 a year, and take over a store building he owns and currently rents for $6, 000 a year.His expenses at the sushi bar would be $50, 000 for food and $2, 000 for gas and electricity.What is the minimum revenue he must earn per year in order for it to be worth his while to open his sushi bar?
A)$26, 000
B)$66, 000
C)$78, 000
D)$52, 000
E)$72, 000

Question

Quizplus · Accepted Answer

The minimum revenue must cover the opportunity cost of quitting his job ($20,000), the lost rental income ($6,000), and the expenses for food, gas, and electricity ($50,000 + $2,000), totaling $78,000.

A Young Chef Is Considering Opening His Own Sushi Bar