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6. Problems and Applications Q6 Consider the following cost information for a pizzeria: Quantity Total Cost Variable Cost (Dozens of pizzas) (Dollars) (Dollars) 0 280
6. Problems and Applications Q6
Consider the following cost information for a pizzeria:
Quantity | Total Cost | Variable Cost |
---|---|---|
(Dozens of pizzas) | (Dollars) | (Dollars) |
0 | 280 | 0 |
1 | 320 | 40 |
2 | 350 | 70 |
3 | 380 | 100 |
4 | 420 | 140 |
5 | 470 | 190 |
6 | 530 | 250 |
The pizzeria's fixed cost is
.
Complete the third column of the following table by calculating the marginal cost per dozen pizzas using the information on total cost. Then complete the final column by calculating the marginal cost per dozen pizzas using the information on variable cost.
Quantity | Total Cost | Marginal Cost | Variable Cost | Marginal Cost |
---|---|---|---|---|
(Dozens of pizzas) | (Dollars) | Using Total Cost | (Dollars) | Using Variable Cost |
(Dollars) | (Dollars) | |||
0 | 280 | 0 | ||
1 | 320 | 40 | ||
2 | 350 | 70 | ||
3 | 380 | 100 | ||
4 | 420 | 140 | ||
5 | 470 | 190 | ||
6 | 530 | 250 | ||
True or False: It doesn't matter whether you compute marginal cost using total cost or variable cost.
True
False
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