Refer to Scenario 9

question 144

Multiple Choice

Refer to Scenario 9.5 below to answer the question(s) that follow.
SCENARIO 9.5: Investors put up $520,000 to construct a building and purchase all equipment for a new restaurant. The investors expect to earn a minimum return of 10 percent on their investment. The restaurant is open 52 weeks per year and serves 900 meals per week. The fixed costs are spread over the 52 weeks (i.e. prorated weekly) . Included in the fixed costs is the 10% return to the investors and $1,000 per week in other fixed costs. Variable costs include $1,000 in weekly wages and $600 per week for materials, electricity, etc. The restaurant charges $3 on average per meal.
-Refer to Scenario 9.5. In the long run, the restaurant will want to

• A) operate and expand.
• B) operate but not expand.
• C) shut down but not go out of business.
• D) go out of business.

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Definitions:

English

A West Germanic language that originated from the Anglo-Frisian dialects brought to Britain in the mid-5th to 7th centuries AD by Anglo-Saxon settlers.

Native Language

The first language learned by an individual, usually from birth, and often considered one's mother tongue or language of the heart.

Neyooxet Greymorning

A notable scholar and indigenous rights advocate, particularly recognized for his contributions to the understanding and preservation of indigenous cultures and languages.

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A Native American tribe historically based in the Great Plains area of the United States.