American InterContinental University Benefits Structure for CapraTek Discussion

In today’s fast-paced world, new laws and technologies come along that can change the way a business operates and its costs structure. Recently, Valley Farms restaurant’s costs went up because of a new higher minimum wage in their area. They decide to raise their average meal ticket price, from $14–16, to cover the higher cost. Their variable costs are 60% of the selling price, and their fixed costs are $10,000 per month.

  • Discuss the cost–volume–profit relationships restaurants should consider before raising their prices.
  • Share some of the non-monetary factors to consider before raising a selling price.
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