Question

The Skulls, a student social organization, has two different locations under consideration for constructing a new chapter house. The Skulls' president, a POM student, estimates that due to differing land costs, utility rates, etc., both fixed and variable costs would be different for each of the proposed sites, as follows:Alpha Ave - $500 fixed $200 variable per personBeta Bld. - $$800 fixed $150 variable per personWhat would be the total annual costs for the Alpha Ave. location with 20 persons living there?(a) $5,400(b) $4,000(c) $5,000(d) $7,000(e) $9,000

Answer 1

Answer:

$4,500

Explanation:

In order to solve this you just have to multiply the amount of persons by the fee per person that they would incur by having the 20 people living there:

So there are 20 people and each will cost $200:

$200*20=$4000

And you add $500 of the fixed costs:

$4000+$500=$4500

So the total cost would be $4,500.