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CASE ANALYSIS IN BUSINESS MATHEMATICS

Individual Project

Name: __________________________________ Grade/ Section: _______________________

Teacher: ________________________________ Date: ____________ Rating: ___________

General Directions: Read, analyze and solve the problem. Write your answer to the space provided.
Strictly NO ERASURES.
Problem:
Clarence is a young entrepreneur who is planning to set up a small food stall near a school. He

plans to sell breaded pork chop rice meals at very affordable prices. After initial market studies, he

figures that he can sell at least 70 orders of his pork chop meals per day. However, he is concerned

whether his business can be profitable. As the area is not quite a well-off neighborhood, he is

concerned about the pricing of his meals. He realizes that he cannot charge premium prices for his

meals.

His pork chop meals have three main components – the pork chop, which he will buy at

P10.00 per piece; rice, which costs P1,750.00 per 50 kg sack; and gravy, which he buys at P150.00

per pack. Since he plans to buy his ingredients in bulk, he expects to get a 10% trade discount from

the wholesaler. Based on his serving sizes, he estimates one kilogram of rice to be good for about

eight orders of his rice meal and one pack of gravy to be enough for an entire day. Of course. Each

meal includes one slice of pork chop. Being in the food business, he reckons a 125% markup based

on the cost of the ingredients for each meal would be the very least he would be willing to impose.

Aside from these, he expects to pay P10,000.00 per month for rental space, an average of

P500.00 per month for business permits and other fees, and P630.00 per day as salary for his

saleswoman. Assuming his stall is open for 20 school days in a month, is his planned 125% markup

large enough to make his business at least break even at the end of the month?