Question

You have decided to start a vending machine business. A local store has space available for your machine but wants to charge you an annual fee to use the space. You estimate that you can sell 5,000 cans of soda each year. You sell a can of soda for $1.25, which allows you a profit of $0.50 per can. What is the most you would spend to lease the space for one year?

Answer 1

The answer has been presented in the supporting sheet. All the parts has been solved with detailed explanation and format. For detailed answer refer to the supporting sheet.

H Answer In the given question we have to calculate the maximum annual fee to use the space of local store can pay for one year Maximum annual fees = No. of soda sold per year * profit per soda = 5000*$0.5 = $ 2500 Thus the correct answer is $ 2500