The cost components of a heater include $35 for the compressor, $12 for the sheet molded compound frame, and $80 per unit for assembly.The factory machines and tools fixed cost is $55,000.The company expects to produce 1,500 heaters in the coming year.What cost function best represents these costs?
A)y = 1,500 + 127X
B)y = 1,500 + 55,000X
C)y = 55,000 + 1,500X
D)y = 55,000 + 127X
E)y = 55,080 + 47X

Question

Quizplus · Accepted Answer

The cost function includes the fixed cost of $55,000 and the variable cost per unit, which is the sum of $35, $12, and $80, totaling $127 per unit.

The Cost Components of a Heater Include $35 for the Compressor