University in UK is considering eliminating the use of trays in the university campus' cafeteria as a way of reducing energy costs and fulfilling the university's Sustainability Sub-Strategy (SSS). The University has spent 40,000 in the purchase of 20,000 trays for the campus cafeteria. Advocates argue that the fewer the number of trays used, the lower will be the costs of cleaning the trays, resulting in savings on water and overall energy usage. Based on an experiment conducted in 2019 in which students were asked to voluntarily reduce their use of trays, the university was able to estimate the annual cost savings associated with varying levels of cooperation, and are given in the table below. In the experiment, however, it became clear that as students used fewer trays, additional help was needed to bus tables and clean them after meal periods were over. Additional labor costs were estimated to be an additional 20.00 for every tray no longer used. Also, higher energy costs were needed to keep the cafeteria open and lighted to clean it, amounting to 500 per 100 trays reduced annually. Total Cost Savings Number of Trays No Longer Used 5,000 6,000 7,000 100,000 190,000 270,000 8,000 340,000 9,000 400,000 10,000 450,000 11,000 490,000 12,000 520,000 13,000 540,000 14,000 550,000 With reference to the data obtained from the experiment on the number of trays no longer used and total cost savings above, you are asked to write a short report that includes: a) describing the marginal analysis you conduct and present your estimates of MB (Marginal Benefit), TC (Total Cost), MC(Marginal Cost) and NB (Net Benefit) together with data provided in a table. University in UK is considering eliminating the use of trays in the university campus' cafeteria as a way of reducing energy costs and fulfilling the university's Sustainability Sub-Strategy (SSS). The University has spent 40,000 in the purchase of 20,000 trays for the campus cafeteria. Advocates argue that the fewer the number of trays used, the lower will be the costs of cleaning the trays, resulting in savings on water and overall energy usage. Based on an experiment conducted in 2019 in which students were asked to voluntarily reduce their use of trays, the university was able to estimate the annual cost savings associated with varying levels of cooperation, and are given in the table below. In the experiment, however, it became clear that as students used fewer trays, additional help was needed to bus tables and clean them after meal periods were over. Additional labor costs were estimated to be an additional 20.00 for every tray no longer used. Also, higher energy costs were needed to keep the cafeteria open and lighted to clean it, amounting to 500 per 100 trays reduced annually. Total Cost Savings Number of Trays No Longer Used 5,000 6,000 7,000 100,000 190,000 270,000 8,000 340,000 9,000 400,000 10,000 450,000 11,000 490,000 12,000 520,000 13,000 540,000 14,000 550,000 With reference to the data obtained from the experiment on the number of trays no longer used and total cost savings above, you are asked to write a short report that includes: a) describing the marginal analysis you conduct and present your estimates of MB (Marginal Benefit), TC (Total Cost), MC(Marginal Cost) and NB (Net Benefit) together with data provided in a table
