Question

Zane's Vanes is a service that restores old weather vanes. Zane has just spent $125 purchasing a 1920s-era weather vane which he expects to restore and sell for $500 once the work is completed. After having spent $125, Zane realizes that he will need to spend an additional $200 on materials to complete the restoration. Alternatively, he can sell the weather vane without restoring it for $200. What should he do?

Answer 1

Zane should finish the restoration and sell the weather vane for 500

Step-by-step explanation:

Opcion A = Finish the vane

Opcion B = Sell the vane without restoring

Opcion A Opcion B

Expected Income 500 200

Purchase of the vane -125 -125

Additional Expend -200 0

Net Income 175 75