In one year, the Hotel by the Shore incurred $100,000 in fixed costs. Because the hotel booked 10,000 room nights, its total variable cost is $100,000 (10,000 room nights × $10 per room). Thus, its total cost is
A) $10,000.
B) $200,000.
C) $20,000.
D) $100,000.
E) $120,000.

Question

Quizplus · Accepted Answer

The total cost is the sum of fixed costs and total variable costs. Fixed costs are $100,000, and total variable costs are $100,000, so the total cost is $200,000.

In One Year, the Hotel by the Shore Incurred $100,000