DD · 2026-08-10 · 0 helpful
The second girdle is a fixed cost and it is considered at a total level - however, it cancels out since we are looking at the incremental profits here. The cart can make 96 orders w/o the helper and 120 with them -> 24 additional orders generate additional profit of 960 (24 * 40 each). 960 is the difference amount in profit between 2 cases, the fixed cost is already accounted here.
If we go a step back and calculate total profits, then first case would be 96*40 =3,840. The profit after reducing the girdle cost would be 3,840 -500. Using the same logic, the total profit after backing out the girdle cost in the second case would be 4,800 - 500. When you take the difference between these cases, the 500 cancels out to give you 960. Because of this, we don't need to reduce it again.
If we go a step back and calculate total profits, then first case would be 96*40 =3,840. The profit after reducing the girdle cost would be 3,840 -500. Using the same logic, the total profit after backing out the girdle cost in the second case would be 4,800 - 500. When you take the difference between these cases, the 500 cancels out to give you 960. Because of this, we don't need to reduce it again.