C-Drive Components Has Collected the Following Production Data for the Past

question 89

Multiple Choice

C-Drive Components has collected the following production data for the past four months: $\begin{array}{cr}\text { Units produced } & \text { Total cost } \\ 7,000 & \$ 16,500 \\10,000 & 22,500 \\8,500 & 17,750 \\9,000 & 21,000\end{array}$ If the high-low method is used, what is the monthly total cost equation?

• A)Total cost = $2,500 + ($2.00 × units produced)
• B)Total cost = $3,750 + ($2.75 × units produced)
• C)Total cost = $1,500 + ($2.00 × units produced)
• D)Total cost = $500 + ($2.25 × units produced)

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Definitions:

Absolute Advantage

The capability of a body to generate a product or offer a service with greater efficiency than its rivals, utilizing an identical quantity of resources.

Exchange Rate

The rate at which one currency can be exchanged for another.

Japanese Yen

The official currency of Japan, used as a medium of exchange in the country.

Comparative Advantage

The ability of an individual or group to produce a good or service at a lower opportunity cost than other producers.