1. Suppose you have an opportunity to purchase 1,000 bottles of wines from a wholesaler for $5 per bottle. You would then sell the wines to various liquor stores for $9 per bottle. In addition to the cost of purchasing the wine, you need to pay $500 in transportation costs to distribute your inventory to the various liquor stores.
Should you take this opportunity? Why or why not? (Hint: show your ROI calculations)
2. Due to the pandemic, the liquor stores have fallen on hard times and are now only willing to pay you $6 for each bottle of wine. Additionally, the cost of transporting the wine has also increased to $750.
Should you take this opportunity? Why or why not? What may be some considerations you may need to take into account in order to make this decision?
