Final answer:
An increase in rent for Jean and Tom's office will result in an increase in total costs for HHH since rent is a fixed cost. This outcome is similar to a situation where a Yoga Center has to absorb higher rent costs, which results in greater losses regardless of their operation status.
Step-by-step explanation:
If rent on the office that Jean and Tom use to run HHH increased by $1,500, the effect of this on HHH's costs would be that total costs will increase. This is because rent is considered a fixed cost, a cost that does not change with the level of output in the short term. Therefore, an increase in rent will result in an increase in total fixed costs.
Using the Yoga Center example for illustration, if the Yoga Center faces an increase in its rent, it must absorb this cost whether it shuts down or continues to operate. If it continues to operate, the higher rent increases its fixed costs, and in all scenarios, whether the center has clients or not, the increased rent results in greater losses than before.
Considering the scenarios provided, if the rent increases while revenues and variable costs remain constant, the center would face higher losses. An increase in fixed costs due to higher rent does not affect the marginal costs like hiring yoga teachers, which are variable costs; it simply raises the baseline over which variable costs are added, leading to higher total costs.