Explanation:
given data:
lemonade to be sold = 20cups at $20.
cost of sign post = $10.
cost of cup and lemonade mix = $15.
A. Marah profit from the venture would be
= Sales made – Total cost
= $20 – $25
= –$5.
B. Based on the information above Marah should forget about Opening the lemonade stand as she would be running at a loss of $5.
C. The $10 spent on the sign is a sunk cost because it cannot he recovered after it has been spent.
The profit Marah would earn s $-5.
The shop should not be opened because a loss would be earned.
The cost of the sign is sunk cost.
Profit = total revenue - total cost
Total revenue = price of a cup of lemonade x total cups sold
20 x $1 = $20
Total cost = $10 + $15 = $25.
Profit = $20 - $25 = $-5
Sunk cost is the cost that has already been incurred and it cannot be recovered. Sunk cost should not be considered when making future decisions.
To learn more about sunk cost, please check: https://brainly.com/question/25820493
