Question

Paul is going to have the exterior of his home painted. Painting USA charges $75.00 to come out and evaluate the house plus $25.00 per hour of labor. Upscale Home Painting does not charge to evaluate the house. However, they charge $40.00 per hour.
If it takes 25 hours to paint Paul’s house, the most cost effective company will be?


The cost of painting the house will be the same for both companies if the number of hours required to paint Paul’s house is?

Answer 1

The most cost effective company will be:

$75.00
25 hours

Painting USA: Fixed Cost: $75; Variable Cost: $25x
Total Cost = 75 + 25(25) = 75 + 625 = 700

Upscale Home Painting: Fixed Cost: $0; Variable Cost: $40x
Total Cost = 40(25) = 1,000

The most cost effective company will be Painting USA whose charges will amount to $700


The cost of painting the house will be the same for both companies if the number of hours required to paint Paul's house is:

Painting USA:
Total Cost: 75 + 25(25) = 75 + 625 = 700

Upscale Home Painting
Total Cost: 40(16.5) = 40 + 660 = 700

The cost of painting the house will be the same for both companies if the number of hours required to paint Paul's house is approximately between 16.5 and 25 hours.

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Answer 2

The most cost effective company will be:

$75.00
25 hours

Painting USA: Fixed Cost: $75; Variable Cost: $25x
Total Cost = 75 + 25(25) = 75 + 625 = 700

Upscale Home Painting: Fixed Cost: $0; Variable Cost: $40x
Total Cost = 40(25) = 1,000

The most cost effective company will be Painting USA whose charges will amount to $700


The cost of painting the house will be the same for both companies if the number of hours required to paint Paul's house is:

Painting USA:
Total Cost: 75 + 25(25) = 75 + 625 = 700

Upscale Home Painting
Total Cost: 40(16.5) = 40 + 660 = 700

The cost of painting the house will be the same for both companies if the number of hours required to paint Paul's house is approximately between 16.5 and 25 hours.