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Robert currently is a brew master for CDI Brewery. He likes his job, but is intrigued by the prospect of quitting and starting his own business. He is currently making $62,000 at CDI Brewery. Robert anticipates that his new brewery will have annual revenues of $230,000, and total annual expenses for operating the brewery, outside of any payments to Robert, will be $190,000. Robert comes to you with his idea.
Question 1: He thinks that he would be equally happy with either option, but that starting his own business the appropriate action in light of its profitability. Ignoring what might happen beyond the first year, do you agree with him? Why or why not?
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