The costs of doing business for a company can be found by adding fixed costs, such as rent, insurance, and wages, and variable costs, which are the costs to purchase the product you are selling. The portion of the company’s fixed costs allotted to this product is $300, and the supplier’s cost for a set of tile is $6 each. Let x represent the number of tile sets.

Question

The costs of doing business for a company can be found by adding fixed costs, such as rent, insurance, and wages, and variable costs, which are the costs to purchase the product you are selling. The portion of the company’s fixed costs allotted to this product is $300, and the supplier’s cost for a set of tile is $6 each. Let x represent the number of tile sets.

c. If b represents a fixed cost, what value would represent b?

d. Find the cost equation for the tile. Write your answer in the form C = mx + b.

Answer 1

c. To find the variable representing fixed costs, we need to remember that the portion of fixed costs allotted to this product is $300. Hence, the value representing fixed costs, which is b, would be equal to $300.

d. To find the cost equation for the tile, we need to combine the fixed costs and the variable costs. The variable cost here is the cost to purchase each tile set, which is given as $6. We can express the cost equation in the form C = mx + b, where C represents the total cost, m represents the variable cost per unit, x represents the number of units, and b represents the fixed cost.

In this case, the cost equation for the tile would be:
C = 6x + 300.

This equation signifies that the total cost of purchasing the tile sets would be equal to 6 times the number of sets purchased, plus the fixed cost of $300.