Marginal cost calculation ! Jane needed furniture for her apartment so she went
ID: 1150356 • Letter: M
Question
Marginal cost calculation !Jane needed furniture for her apartment so she went to IKEA. After picking out what she needed, her total added up to 2,200 dollars. There is a 100 dollar delivery fee if she spends less than 2,500 dollars. What would be the marginal cost to jane if she added a dresser priced for 600 dollars to her order?
Economics- Marginal Cost - Help Marginal cost calculation !
Jane needed furniture for her apartment so she went to IKEA. After picking out what she needed, her total added up to 2,200 dollars. There is a 100 dollar delivery fee if she spends less than 2,500 dollars. What would be the marginal cost to jane if she added a dresser priced for 600 dollars to her order?
Economics- Marginal Cost - Help
Jane needed furniture for her apartment so she went to IKEA. After picking out what she needed, her total added up to 2,200 dollars. There is a 100 dollar delivery fee if she spends less than 2,500 dollars. What would be the marginal cost to jane if she added a dresser priced for 600 dollars to her order?
Economics- Marginal Cost - Help
Explanation / Answer
Total amount of the products she initially picked = $2,200.
Now, since this amount is less than $2,500, she will be charged a delivery fee of $100.
So, the total amount to be paid by her will be $2,300.
Now, if she adds a product worth $600.
She will produce a total of $(2,200 + 600) = $2,800 worth of products.
Now, since that exceeds $2,500, she will not be charged $100 delivery fee and the total amount to be paid by her will be $2,800.
The marginal cost for this problem will be $(2,800 - 2,300) = $500.