total cost of flight is $8,000, which includes pilots, one flight attendant, fue
ID: 1103392 • Letter: T
Question
total cost of flight is $8,000, which includes pilots, one flight attendant, fuel and others. The cost for additional passenger is $2 and for additional flight attendant is $400. The capacity of the plane is 200 passengers. If the flight has more or equal than 50 passengers, one additional flight attendant is needed. If the flight has more or equal than 100 passengers, two additional flight attendants are needed. If the flight has more or equal than 150 passengers, three additional flight attendants are needed.
1) What is the marginal cost for the 1st additional passenger?
2) What is the average variable cost for 80 additional passengers?
3) What is the marginal cost for the 50th passenger?
4) What is the average variable cost for 170 additional passengers?
5) Compare the AVC and MC for 80 additional passengers. Can you infer with the AVC? 6) Compare the AVC and MC for with the AVC?
Explanation / Answer
1.
Marginal cost of 1st additional passenger = $2
2.
Average variable cost for 80 additional passenger = (80*2 + 400)/80 = $7
3.
Marginal cost of 50th passenger = 2+400 = $402
4.
Average variable cost for 170 additional passenger = (170*2 + 3*400)/170 = $9.06
Pl. repost other unanswered questions for their proper answers!
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.