Question 597332: If you own a pizza business and your cost is 5 dollars for a 6 inches pizza, what would you charge for an 18 inch pizza? Answer by solver91311(24713) (Show Source):
Impossible to answer. You haven't established a proportional relationship between the cost of a pizza and its diameter. And you haven't provided any profit margin information.
You could establish that a pizza with three times the diameter (and therefore 3 times the radius) has an area that is 9 times the smaller pizza so as to make a claim that the 18 inch pizza costs 9 times the cost of the 6 inch.
The problem with that idea is that some of the $5 cost of making the 6 inch pie is fixed overhead cost, that is to say cost that remains the same whether you make a 6 inch pizza or one that is 5 feet across and fills the entire oven, and the rest of the $5.00 is the cost of ingredients which cost is related to the actual size of the pie.
But even if you had provided information to allow allocation of the fixed and variable costs, your question asks for the PRICE of the larger pizza. You can't get from cost to price without some idea of the margin.
John
My calculator said it, I believe it, that settles it
