Gourmet Ices (GI) Gl is a partnership owned by Tom and Amy Smith. The business makes and sells high-quality ice cream. At present the ice cream is only sold through businesses near to Gl, but the owners would like to expand the business and sell ice cream throughout the country. The ice cream is handmade in small batches. Gl employs five skilled workers who make the ice cream. Labour costs account for over half of the direct costs of the business. Tom believes that it will be necessary to use Computer Aided Manufacturing (CAM) to increase production and decrease costs so that Gl can sell throughout the country (see Table 1). However, Amy is worried that the quality of the ice cream may decrease. [Table 1: Estimated production costs and revenue data] Variable costs (per unit) Without CAM With CAM $1.50 $1.00 Total fixed costs each month $5000 $15000 Revenue (per unit) $2.50 $2.50 Estimated output each month 7500 units 25000 units Tom and Amy would need to raise $50000 of additional finance to expand GI. They have researched crowd funding and venture capital as possible sources of finance. Tom and Amy have decided that they would prefer to use venture capital. They are considering two offers from venture capitalists. Offer 1: Amit The offer is for $50000 and Amit would want 51% ownership of the business. Amit owns a nationwide supermarket chain and would be willing to stock the ice cream in all of the supermarkets if his offer is accepted. He also has a lot of marketing experience. Offer 2: Rebecca The offer is for $50000 and Rebecca would want 30% ownership of the business. Rebecca owns a clothes manufacturing factory and she has knowledge of using CAM. She is very experienced with operations and project management and she believes that she can further reduce the costs of the business and increase the profit margin.