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Table 7.2
-(Table 7.2) Carl's Detailing is a small business that travels to people's homes to meticulously clean their high-end sports cars. Carl hires detailers (labor) at a wage of $80 per day per worker. A van that is used to carry cleaning supplies to clients' homes has a fixed cost of $20 per day. The table shows the relationship between the number of cars cleaned and the number of detailers. The marginal cost of cleaning the first car is _____, and the marginal cost of cleaning the third car is _____.

Question

Use the following to answer question:
Table 7.2 
-(Table 7.2) Carl's Detailing is a small business that travels to people's homes to meticulously clean their high-end sports cars. Carl hires detailers (labor) at a wage of $80 per day per worker. A van that is used to carry cleaning supplies to clients' homes has a fixed cost of $20 per day. The table shows the relationship between the number of cars cleaned and the number of detailers. The marginal cost of cleaning the first car is _____, and the marginal cost of cleaning the third car is _____.

Quizplus · Accepted Answer

The marginal cost is the additional cost of producing one more unit of output. From the table, we can see that to clean the first car, Carl needs to hire one detailer, which costs $80 for the day. Therefore, the marginal cost of the first car is $80. To clean the third car, Carl needs to hire three detailers, which costs a total of $240 for the day (3 x $80). The marginal cost of the third car is the additional cost of producing one more car after the second one, which is $240 - $100 = $140. Therefore, the marginal cost of cleaning the third car is $140.

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