The area manager of the Red, White, and Brew Restaurants is considering two poss

Question

The area manager of the Red, White, and Brew Restaurants is considering two possible expansion alternatives. The required investments, expected controllable margins, and the ROIs of each are as follows:

The Red, White, and Brew segment has currently $2,000,000 in invested capital and a controllable margin of $250,000. Which one of following projects will increase the Red, White, and Brew division's ROI?

Both the Phoenix and Chicago options

Only the Phoenix option

Only the Chicago option

Neither the Phoenix nor the Chicago options

Project Investment Controllable Margin ROI Phoenix $120,000 $30,000    25% Chicago $540,000 $50,000 9.25%

Explanation / Answer

Hi,

Please find the answer as follows:

Only the Phoenix option is the correct answer.

Thanks.

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.