question archive Two automatic systems for dispensing maps are being compared by the state highway department
Two automatic systems for dispensing maps are being compared by the state highway department
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Two automatic systems for dispensing maps are being compared by the state highway department. The total cost for system 1 is y1 = 0.9 x + 1.0, and the total cost for system 2 is y2 = 0.1 x + 5.
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- What are the fixed and variable costs for system 1?
- What are the fixed and variable costs for system 2?
- What is the number of maps dispensed at which the two systems have equal annual costs?
- For what range of annual number of maps dispensed is system 1 recommended?
- For what range of annual number of maps dispensed is system 2 recommended?
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ANS:
(a) Variable cost = 0.9 Fixed cost = 1
(b) Variable cost = 0.1 Fixed cost = 5
(c) 0.9 x + 1.0 = 0.1 x + 5
0.8x = 4
x = 5
(d) 0,5
(e) 5,∞
