Question

A machine shop has a fixed set-up cost of $2000 to produce new bolts. The cost of materials and labor to produce each individual bolt is $8.50. Which of the following functions models the average cost per bolt for the company to produce x bolts, where x> 1? C(x) = 2000 + 8.50xC(x) = (2000 + 8.50)xC(x) = 2000 + 8.50/xC(x) = 2000 + 8.50x/x

Answer 1

The setup cost (fixed) is $2000

The cost to produce a bolt (just one bolt) is $8.50

The cost to produce x bolts would be 8.50x

The total cost for x bolts would therefore be

`2000+8.50x`

The average cost per bolt would therefore be

`C(x)=(2000+8.50x)/(x)\text{ dollars}`

Option D