You run a school in Florida. Fixed monthly cost is $5,909.00 for rent and utilities, $5,531.00 is spent in salaries and $1,775.00 in insurance. Also every student adds up to $98.00 per month in stationary, food etc. You charge $683.00 per month from every student now. You are considering moving the school to another neighborhood where the rent and utilities will increase to $11,500.00, salaries to $6,043.00 and insurance to $2,370.00 per month. Variable cost per student will increase up to $158.00 per month. However you can charge $1,162.00 per student. How much do you currently charge per student?
You run a school in Florida. Fixed monthly cost is $5,909.00 for rent and utilities, $5,531.00 is spent in salaries and $1,775.00 in insurance. Also every student adds up to $98.00 per month in stationary, food etc. You charge $683.00 per month from every student now. You are considering moving the school to another neighborhood where the rent and utilities will increase to $11,500.00, salaries to $6,043.00 and insurance to $2,370.00 per month. Variable cost per student will increase up to $158.00 per month. However you can charge $1,162.00 per student. How much do you currently charge per student?
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter4: Extent (how Much) Decisions
Section: Chapter Questions
Problem 4.5IP
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You run a school in Florida. Fixed monthly cost is $5,909.00 for rent and utilities, $5,531.00 is spent in salaries and $1,775.00 in insurance. Also every student adds up to $98.00 per month in stationary, food etc. You charge $683.00 per month from every student now. You are considering moving the school to another neighborhood where the rent and utilities will increase to $11,500.00, salaries to $6,043.00 and insurance to $2,370.00 per month. Variable cost per student will increase up to $158.00 per month. However you can charge $1,162.00 per student. How much do you currently charge per student?
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