Assume that it will cost a dog groomer an additional $28,000 each year to keep her salon open for one additional hour per week. What must her minimum additional yearly (not weekly) revenue from keeping her grooming salon open this additional hour per week be to make staying open for the extra hour economically rational?

Question

Social Studies

Jose Lopez

11 March, 17:49

Assume that it will cost a dog groomer an additional $28,000 each year to keep her salon open for one additional hour per week. What must her minimum additional yearly (not weekly) revenue from keeping her grooming salon open this additional hour per week be to make staying open for the extra hour economically rational?

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Jessica Thompson · Answer 1

The additional income per year that the dog groomer should have from keeping the salon open for another one hour every day per week should be at least $56,000 (twice the expense to keep the salon open).

Explanation:

Before investing time and resources into something, it is necessary to devise the economic cost of the time and resources that one is about to put in an determine whether or not it is profitable. In the given case, it would be feasible to become subject to a cost of $28,000 only if the returns are going to be twice the cost incurred over a period of a year.