Abigail's Auto Art is a company that applies pinstripes to vehicles. Abigail's cost for a basic 1-colour pinstriping job is $40, and she charges $100 for this service. For a total price of $185, Abigail will apply a fancier 3-colour pinstripe application to an automobile, a service that adds an additional $50 to the total cost of the package. What is the marginal cost of moving up from the 1-colour application to the 3-colour application?
A)$40
B)$50
C)$100
D)$175

Question

Quizplus · Accepted Answer

To find the marginal cost, we need to calculate the additional cost incurred by moving from a 1-colour pinstripe job to a 3-colour job.

The cost of a basic 1-colour job is $40, and the cost of a fancier 3-colour job is $185. Therefore, the cost of adding two more colours to the job is $185 - $40 - $50 = $95.

Therefore, the marginal cost of moving up from the 1-colour application to the 3-colour application is $95. Therefore, option B is correct.

Abigail's Auto Art Is a Company That Applies Pinstripes to Vehicles