George Webb Restaurant Collects on the Average $5 Per Customer

question 9

Multiple Choice

George Webb Restaurant collects on the average $5 per customer at its breakfast & lunch diner.Its variable cost per customer averages $3,and its annual fixed cost is $40,000.If George Webb wants to make a profit of $20,000 per year at the diner,it will have to serve__________ customers per year.

• A) 10,000 customers
• B) 20,000 customers
• C) 30,000 customers
• D) 40,000 customers
• E) 50,000 customers

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Definitions:

Capital Investment

The funds spent by a business to acquire or upgrade physical assets such as property, industrial buildings, or equipment.

Land Reform

The process of redistributing land, typically from those with large holdings to those with none or less, with the intent of improving equality and agricultural productivity.

Governments

The organizational bodies that govern a community or nation, setting and administering public policy and exercising executive, political, and sovereign power.

Surplus Agricultural Labor

A condition in agricultural economies where there are more laborers available than are needed to cultivate the land, often leading to unemployment or underemployment in rural areas.