#14 You run a school in Florida. Fixed monthly cost is $5,160.00 for rent and utilities, $5,663.00 is spent in salaries and $1,636.00 in insurance. Also every student adds up to $91.00 per month in stationary, food etc. You charge $685.00 per month from every student now. You are considering moving the school to another neighborhood where the rent and utilities will increase to $10,903.00, salaries to $6,123.00 and insurance to $2,312.00 per month. Variable cost per student will increase up to $152.00 per month. However you can charge $1,031.00 per student. At what point will you be indifferent between your current mode of operation and the new option? Submit Answer format: Number: Round to: 0 decimal places.
#14 You run a school in Florida. Fixed monthly cost is $5,160.00 for rent and utilities, $5,663.00 is spent in salaries and $1,636.00 in insurance. Also every student adds up to $91.00 per month in stationary, food etc. You charge $685.00 per month from every student now. You are considering moving the school to another neighborhood where the rent and utilities will increase to $10,903.00, salaries to $6,123.00 and insurance to $2,312.00 per month. Variable cost per student will increase up to $152.00 per month. However you can charge $1,031.00 per student. At what point will you be indifferent between your current mode of operation and the new option? Submit Answer format: Number: Round to: 0 decimal places.
Chapter32: The Land Market And Natural Resources
Section: Chapter Questions
Problem 4E
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Transcribed Image Text:#14
You run a school in Florida. Fixed monthly cost is $5,160.00 for rent and utilities, $5,663.00 is spent in salaries and
$1,636.00 in insurance. Also every student adds up to $91.00 per month in stationary, food etc. You charge $685.00 per
month from every student now.
You are considering moving the school to another neighborhood where the rent and utilities will increase to $10,903.00,
salaries to $6,123.00 and insurance to $2,312.00 per month. Variable cost per student will increase up to $152.00 per
month. However you can charge $1,031.00 per student. At what point will you be indifferent between your current mode
of operation and the new option?
Submit
Answer format: Number: Round to: 0 decimal places.
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