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Workers at Homework, Inc. write supplementary problem sets for students who need help outside of school. Homework, Inc. has signed a one-year lease on its office that requires it to pay monthly rent. The rent for the office is $1,900 per month. The table below shows Homework's inc total cost for a month of production. Use the available data and the table below to answer the following question. We can start by realizing that total cost is equal to variable cost plus fixed cost. The problem does not mention any fixed costs other than rent. So, I am assuming that there are no other fixed costs. WIth that in mind, total cost of producing 15 sets is $2300, so the variable costs must be $400 (2300-1900). |
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