Suppose Natasha currently makes $50,000 per year working as a manager at a cable TV company. For the soap making opportunity she anticipates annual revenue of $465,000 and costs for the necessary land, labor and capitol of 395,000 per year. For the internet opportunity she anticipates costs for land labor and capitol of$ 3,250,000 per year as compared to revenues of $3,275,000 per year. Should she quit her current job to become an entrepreneur? If she does not quit her current job which opportunity would she pursue?

Question

Business

Noel Wilkerson

30 July, 02:18

Suppose Natasha currently makes $50,000 per year working as a manager at a cable TV company. For the soap making opportunity she anticipates annual revenue of $465,000 and costs for the necessary land, labor and capitol of 395,000 per year. For the internet opportunity she anticipates costs for land labor and capitol of$ 3,250,000 per year as compared to revenues of $3,275,000 per year. Should she quit her current job to become an entrepreneur? If she does not quit her current job which opportunity would she pursue?

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Peterson · Answer 1

She should quit her job, become an entrepreneur and choose the soap making for the highest profit / income of $70,000

Explanation:

Step 1: Calculate Natasha's annual profit if she should start the soap business

The annual profit from Soap Business = Annual Revenue - Costs for the year

The annual profit = $465,000 - $395,000 = $70,000

Step 2: Calculate Natasha's annual profit if she should start the internet opportunity she anticipates

The annual profit for the internet business = Annual Revenue - Costs for the year

= $3,275,000 - $3,250,000 = $25,000

Since she is to make a choice between three options,

1. Manager Job per year = $50,000

2. Soap Making = $70,000

3. Internet Opportunity = $25,000

Then she should quit her job, become an entrepreneur and choose the soap making for the highest profit of $70,000