Small Business Budgeting: Maximizing Profitability

How many sets of napkins can the woman afford to make per month?

Option 1: 344 sets of napkins
Option 2: 367 sets of napkins
Option 3: 729 sets of napkins
Option 4: 489 sets of napkins

Final answer:

The woman can afford to make approximately 344 sets of napkins per month.

Explanation:

To determine how many sets of napkins the woman can afford to make per month, we need to subtract the fixed costs from the total monthly costs, and then divide the remainder by the variable cost per set of napkins. The formula to calculate this is:

Total Sets of Napkins = (Total Monthly Costs - Fixed Costs) / Variable Cost

Plugging in the values given, we get:

Total Sets of Napkins = ($1849 - $1426.49) / $2.49

Total Sets of Napkins ≈ 344

Therefore, the woman can afford to make approximately 344 sets of napkins per month.