Bush Motel's cost function based on guest-days of occupancy for custodial cost is given as: Y = $60,000 + $4.50X.Bush Motel expects an occupancy level of 8,000 guest days.Bush Motel's expected total variable cost is:
A)$5.50
B)$36,000
C)$60,000
D)$115,000

Question

Quizplus · Accepted Answer

The expected total variable cost is calculated by multiplying the variable cost per unit ($4.50) by the number of units (8,000 guest days), which equals $36,000.

Bush Motel's Cost Function Based on Guest-Days of Occupancy for Custodial