it costs $2000 to purchase a copier, and each copy costs $0.02 to make. what is the fixed cost? what is the variable cost? and what is the cost equation for c in the terms of x?
c = 2000 + .02 x
To determine the fixed cost and variable cost in this scenario, we need to understand the concept of fixed and variable costs.
Fixed cost refers to the expenses that remain constant regardless of the level of production or the number of copies made. These costs do not change with the volume of production or copies made.
Variable cost, on the other hand, changes with the level of production or the number of copies made. These costs vary directly with the number of copies produced.
In the given scenario:
- The cost to purchase the copier equipment, amounting to $2000, is a one-time fixed cost. This cost remains constant regardless of the number of copies made.
- The cost of each copy made is $0.02, and this cost varies based on the number of copies made. Thus, it is the variable cost.
Now, let's derive the cost equation for c in terms of x, where x represents the number of copies made.
The fixed cost ($2000) will remain the same regardless of x.
The variable cost ($0.02) will vary based on the number of copies made (x).
Therefore, the cost equation for c in terms of x is:
c = fixed cost + (variable cost per copy * number of copies)
c = $2000 + ($0.02 * x)
In summary:
- Fixed cost: $2000
- Variable cost: $0.02 (per copy)
- Cost equation for c in terms of x: c = $2000 + ($0.02 * x)