Question

Marco is investigating some of the business models of SureSpin, one of Faster Fidget's top competitors. He has learned that they model their cost of production for one type of spinner with the function C(x) = 13,450 + 1.28x, where x is the number of spinners produced. Interpret the model to complete the statement. Type the correct answer in each box. Use numerals instead of words. Based on the model, the fixed cost of production is $

Answer 1

$13,450

Explanation:

The fixed costs of production, are the costs incurred that are independent from the production volume, that is, regardless of how many spinners the company produces, those costs will remain the same. If 'x' is the number of spinners produced, interpreting the cost function, we can see that it costs $1.28 to produce each spinner and that there is a cost that does not rely on production of $13,450. Therefore, the fixed cost of production is $13,450.