Question

Lionel's lawn care is a company that maintains residential yards. Lionel's cost for his standard package of mowing, edging, and trimming is $15, and he charges $25 for this service. For a total price of $40, lionel will also trim shrubs, a service that adds an additional $10 to the total cost of the standard package. Should lionel continue to offer the shrub-trimming service?

Answer 1

Answer: Lionel makes a profit of $5 on his shrub trimming service alone. This will add to a profit of $10 he earns on his standard service. Hence Lionel should continue offering the shrub trimming service.

Lionel makes a profit of
`$10 (25-15)` on his standard service

The revenue earned from offering shrub trimming also is $40.

The additional revenue earned from shrub trimming is
`40-25 = 15`

The additional cost of shrub trimming is $10.

So, the profit earned on the shrub trimming service is
`15-10 = $5`