A firm pays Pam $40 per hour to assemble personal computers. Each day, Pam can assemble 4 computers if she works 1 hour, 7 computers if she works 2 hours, 9 computers if she works 3 hours, and 10 computers if she works 4 hours. Pam cannot work more than 4 hours day. Each computer consists of a motherboard, a hard drive, a case, a monitor, a keyboard, and a mouse. The total cost of these parts is $600 per computer. What is the marginal cost of producing the computers that Pam can assemble during her 2^nd hour of work?

Question

Quizplus · Accepted Answer

During her 2+1+1+4+1+0 = 9 hours of work, Pam can assemble 4+7+9+10+0+0 = 30 computers.

To find the marginal cost, we need to calculate the cost of producing one additional computer. We can use the total cost of production and divide it by the number of computers:

Total cost = $600 x 30 = $18,000

Marginal cost = Total cost of production / Number of computers = $18,000 / 30 = $600

Therefore, the marginal cost of producing the computers that Pam can assemble during her 9 hours of work is $600.

However, we need to calculate the cost for Pam's specific work hours, which is 2+1+1+4+1+0 = 9 hours.

Total pay for Pam = $40 x 9 = $360

Total cost of production during Pam's work hours = 30 x $600 = $18,000

Total cost for Pam's work hours = Total pay for Pam + Total cost of production = $360 + $18,000 = $18,360

Marginal cost for Pam's work hours = Total cost for Pam's work hours / Number of computers = $18,360 / 30 = $612

Therefore, the marginal cost of producing the computers that Pam can assemble during her 9 hours of work, considering her specific work hours, is $612.

The best choice is B, as it correctly calculates the marginal cost for Pam's specific work hours.

A Firm Pays Pam $40 Per Hour to Assemble Personal