- Energy Drinks At The Can Can Go Arnold The Store Manager Is Trying To Decide Two Things 1 How Many Cans Of Energy D 1 (245.47 KiB) Viewed 55 times
the graph at the end! Thank you.
Energy Drinks at the Can-Can-Go! Arnold, the store manager, is trying to decide two things: 1) How many cans of Energy Drink to have on display in his store each week 2) What price to charge for the Energy Drink. Arnold thinks he should sell the drinks for $3. What do you say to him? Use the following information to advise him: Weekly Demand in the neighborhood: Qd=150-25P Wholesale Cost of Energy Drink (per unit): $0.90 each Cans that can be displayed on one linear foot: 20 cans Fixed cost per Linear Foot Opportunity Cost of displacing existing merchandise: ??? : $50 In order to make room for an Energy Drink Display, Arnold will need to reduce the current merchandise in his store. He can either cut into his candy aisle, his cigarette display, his lottery area, or the Novelty POS. Current Total Cost per Linear Current Display Foot Revenue Candy $500 Cigarettes $3,500 Lottery $880 Novelty $525 Quantity Demanded Retail Price Revenue VC TC MC Profit ATC $590 $4,000 $1,050 $680 MR FC
Should they sell Energy drinks at this location? What price should they charge? How many units will they sell? How much accounting profit will be made each week with energy drinks? What will be the economic profit/loss each week with energy drinks? Use your analysis of the energy drink market to label the graph below Write the $value into the three arrows on the price axis Write the correct quantities into the two arrows on the Qaxis Label both Axes. Label all curves. M Name: