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Give step-by-step solution with explanation and final answer: {give me the answer without using bullet-points}Exercise 1 (4 points): Careline, an entrepreneur wants to open a new restaurant in town. Two locations seem to be feasible (because of the intial investment needed), However, because of cash flow sues, Caroline determined that she needs to break: even I 10 11078 than 90 days. Could you help Caroline decide which location seems more promising? include a short discussion of your conclusion Location A: initial investment: $100.000 The place s relately big and is situated at a point of passage during lunch time. Unfortunately. 1 1» relatively deserted dunng dinner ime. Caroline estimated she would be able to prepare a lunch menu that would sell for $15 per person in average and would cost $5. By doing so she thinks she can attract an average of 100 people per day. Location B: i initial investment: $120.000 The place 1 tiny and shows no activity during lunch, HOWever it has a certain Je ne sais Quor” and could wel atract peaple for dinner. Caroline thinks of a menu that would sell for $40 per person in average and would cost $10. With such 3 menu she thinks she can attract 35 people per day in average.

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Give step-by-step solution with explanation and final answer: {give me the answer without using bullet-points}Uploaded ImageExercise 1 (4 points): Careline, an entrepreneur wants to open a new restaurant in town. Two locations seem to be feasible (because of the intial investment needed), However, because of cash flow sues, Caroline determined that she needs to break: even I 10 11078 than 90 days. Could you help Caroline decide which location seems more promising? include a short discussion of your conclusion Location A: initial investment: $100.000 The place s relately big and is situated at a point of passage during lunch time. Unfortunately. 1 1» relatively deserted dunng dinner ime. Caroline estimated she would be able to prepare a lunch menu that would sell for $15 per person in average and would cost $5. By doing so she thinks she can attract an average of 100 people per day. Location B: i initial investment: $120.000 The place 1 tiny and shows no activity during lunch, HOWever it has a certain Je ne sais Quor” and could wel atract peaple for dinner. Caroline thinks of a menu that would sell for $40 per person in average and would cost $10. With such 3 menu she thinks she can attract 35 people per day in average.

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Asked by: Francis
Created at: 2026-01-26 16:11:42

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Let's analyze both step by step to determine which is more promising for Caroline, focusing on-even within 90 days. ** A:** investment: $,000 Average lunch price per: $15 Average cost per: $5 Average people per day:100 Daily profit calculation: per day = $15 × = $1,500 Cost day = $5 × 100 $500 per day = $1500 - $ = $1000 How many days to break? Break-even days = Initial / Daily profit $100, / $1,000 = 100 days Caroline needs to break even in 90 days, but Location A takes 100 days. --- **Location B:** Initial investment: $120,000 Average dinner price per person: $40 Average cost per person: $10 Average people per day: 35 Daily profit calculation: Revenue per day = $40 × 35 = $1,400 Cost per day = $10 × 35 = $350 Profit per day = $1,400 - $350 = $1,050 How many days to break even? Break-even days = Initial investment / Daily profit = $120,000 / $1,050 ≈ 114.29 days Location B would break even in about 114 days. --- **Conclusion:** Neither location allows Caroline to break even within 90 days. However, Location A needs 100 days, while Location B needs about 114 days to break even. Therefore, Location A is more promising as it is closer to the 90-day break-even target. **Final Answer:** Location A is the better option for Caroline because it requires fewer days (100) to break even compared to Location B (114 days), even though neither meets the 90-day requirement.

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