Based on the final spreadsheet in Lab 1.1 Excel, Assessing Profitability of a Mowing Business, what is the reason for the difference between Scenario 1 and Scenario 2? 1 Base Scenario 2 Scenario 1 Scenario 2 per Lawn per Lawn 3 4 Assumption: Total Lawns Serviced Each Month 5 6 Revenue 7 8 Costs 10 Truck 11 Mowers 12 Other Equipment 13 Labor (Average $13/yard or $25/yard) 14 Maintenance 15 Insurance 16 Fuel 17 Supplies 18 Advertising 19 Cost per Lawn 20 21 Margin per Lawn 22 23 Total Monthly Margin 200 200 $50 $50 Monthly 300 1.50 1.50 300 1.50 1.50 100 0.50 0.50 13.00 25.00 100 0.50 0.50 300 1.50 1.50 3.00 3.00 1.50 1.50 50 0.25 0.25 23.25 35.25 26.75 14.75 5350.00 2950.00
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Required Information Lab 1.1 Alternate: Assessing Profitability of a Mowing Business [The following information applies to the questions displayed below.] Lab Insight: Apply the same steps in Lab 1.1 to the Lab 1.1 Data.xlsx data set with two modifications. The same scenarios exist as before, with labor costing either $13/lawn or $25/lawn. Assume that your mowing business will mow 350 lawns per month rather than 200 lawns per month. Also assume that the cost for advertising increases from $50 to $300 per month. Label these two new scenarios Scenario 3 (with labor costing $13/lawn) and Scenario 4 (with labor costing $25/lawn). Specify the Question: What is the profit on each lawn if the mowing business mows 350 lawns per month? What is the business's total profit per month? Required: 1. Assess whether this mowing business will be profitable if you mow 350 lawns per month. 2. Show a visualization of the change in monthly margin based on a range of labor costs per lawn. Data: Lab 1.1 Data.xlsx Analyze the Data: Refer to lab 1.1 in your text for additional instructions and steps. Lab 1.1 Alternate: Analysis Questions Note: Submit your answers for the following Analysis Questions in the text entry field below. 1. How did you get a monthly truck payment per lawn of $0.86? 2. How did you get a monthly maintenance charge per lawn of $0.29? 3. Given these changed assumptions, does it make sense to leave your job, in which you earn $4,000/month? Given the results of the analysis, what do you choose and why? Is there anything else that you should consider? Explain.
Akash M.
Decision Point: Building a Cost Table You're getting things in order now: You're happy you have a better grasp of your general expenses for both the short run and the long run, and you have determined your current profit. Now it's time to see what changes you might be able to make to cut costs and increase your profit. The first step is to determine what your ideal scale of operations should be: You go through months of cost data and sort them based on how many lawns were mowed each month; and you build a table of costs for the company. Fill in the missing values for fixed costs and variable costs in the table below and click Submit. Lawns per Month | Total Cost | FC | VC 0 | 5,000 | 5,000 | 100 | 7,000 | | 200 | 8,800 | | 300 | 10,400 | | 400 | 12,200 | | 500 | 14,200 | | 600 | 16,600 | | 700 | 19,400 | | 800 | 22,900 | |
Sri K.
Andrew D.
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