SOLUTION: The manager of a company manufacture surfboard has fixed costs (at o output)$500 per day and the total cost $6500 per day at a daily output of 40 1. write an equation for the cost

Question 162385: The manager of a company manufacture surfboard has fixed costs (at o output)$500 per day and the total cost $6500 per day at a daily output of 40
1. write an equation for the cost funtion with
2.what is the fixed cost,variable cost,and total cost for an output of 28 per day
this is my solution
equation C(x)=500x +6500(40-x)
is this correct please help-----
Answer by gonzo(654) (Show Source): You can put this solution on YOUR website!
fixed cost is a constant value that does not depend on x since it will be the same regardless of how many units are produced.
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the first thing they told you is that the total cost for a day is 6500 when 40 units are produced.
your formula for that would be:
500 + 40*x = 6500
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solving for that, the equation becomes
40*x = 6000
x = 150
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your cost per unit is 150.
the equation for the reduced output is
500 + 28*x = y
where x is the cost per unit and y is the total cost per day.
since you know x, you substitute 150 for x and the equation becomes
500 + 28*150 = y
which becomes
500 + 4200 = y
which becomes 4700 = y
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your answer at 28 units per day is:
cost per unit = $150.00
fixed cost = $500.00
variable cost = number of units times cost per unit = $4200.00
total cost = fixed cost plus variable cost = $4700.00
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