The Owner of Tastee Cookies Needs to Decide Whether to Lease

question 118

Multiple Choice

The owner of Tastee Cookies needs to decide whether to lease a small, medium, or large new retail outlet. She estimates that monthly profits will vary with demand for her cookies as follows:

For what range of probability that demand will be high, will she decide to lease the small facility?

• A)0-0.25
• B)0-0.33
• C)0.25-0.5
• D)0.33-1
• E)0.5-1

---

Definitions:

Enterprise Product

A product or service designed for large organizations, emphasizing robustness, scalability, and integration capabilities.

Variable Cost

Costs that change in proportion to the level of activity or volume produced, such as materials and labor costs.

Enterprise Product

A product designed specifically for organizational use to cater to the complexity and scale of enterprise requirements.

Profit-Volume Chart

A chart used to assist management in understanding the relationship between profit and volume.