Labor Is the Only Variable Input for Elliot's Dog-Walking Service

question 10

Multiple Choice

Labor is the only variable input for Elliot's dog-walking service. His labor costs are $300 a day and his service walks 25 dogs per day. His labor costs increase to $315.50 a day to walk 26 dogs per day. The marginal cost of walking that 26th dog is

• A) $15.50.
• B) $19.50.
• C) $29.50.
• D) indeterminate from the information given.

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Definitions:

Economies Of Scale

The cost advantage achieved by an increase in production, leading to a lower cost per unit.

Facilities

Physical locations or infrastructures where business operations occur, including offices, factories, and warehouses.

Distributors

Entities engaged in the business of distributing goods, typically bought from manufacturers, directly to retailers or customers.

Supply Chain

The entire process of making and selling commercial goods, including raw materials sourcing, manufacturing, distribution, and sales.