Food for Less (FFL), a Grocery Store, Is Considering Offering

question 33

Multiple Choice

Food For Less (FFL) , a grocery store, is considering offering one-hour photo developing in their store. The firm expects that sales from the new one-hour machine will be $175,000 per year. FFL currently offers overnight film processing with annual sales of $90,000. While many of the one-hour photo sales will be to new customers, FFL estimates that 40% of their current overnight photo customers will switch and use the one-hour service. The level of incremental sales associated with introducing the new one hour photo service is closest to ________.

• A) $139,000
• B) $175,000
• C) $36,000
• D) $70,000

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Definitions:

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