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Shaw's Supermarket has on hand a large supply of T-bone steak, and its trying to decide whether to sell the steak as is, or to process them further into filet mignon and NY cut steaks. If the T-bone is sold as is, a 1-pound (16 ounces) steak would sell for $4.50. Processing costs up to that sale point amounted to $3.60. If the one pound steak is further processed, it will yield one 6 oz filet and one 8 oz NY cut, and the remaining 2 oz are waste. The cost of processing the T-bone is $.50 per pound. Filet mignon can be sold for $8 per pound, and NY cut can be sold for $5.60 per pound.
A. If the t-bone is sold as is, what is the profit per pound?B. Calculate the selling price of the filet, the NY cut, and the total revenue, assuming the T-bone steak is processed. Show calculations.C. What is the added revenue from further processing (less the revenue from the one-pound T-bone?D. What is the profit or loss per pound from further processing of one 16-oz t-bone steak?
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