Question

A delivery company is considering adding another vehicle to its delivery fleet; each vehicle is rented for $250 per day. Assume that the additional vehicle would be capable of delivering 1,750 packages per day and that each package that is delivered brings in $0.25 in revenue. Also assume that adding the delivery vehicle would not affect any other costs. Instructions: Round your answers to 1 decimal place. a. What are the MRP and MRC

Answer 1

Answer: See explanation

Explanation:

Based on the information that has been given in the question, the MRP will be calculated as the multiplication of the total packages that was delivered by the revenue that was gotten from one package. This will be:

MRP = 1750 × 0.25

= $437.5

The MRC based on the question = $250

Based on the above, a profit of $187.5 ($437.5 - $250) will be earned.