Grohs Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During December, the kennel budgeted for 2,500 tenant-days, but its actual level of activity was 2,530 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting:
-The administrative expenses in the planning budget for December would be closest to:
Definitions:
Utility Function
A mathematical representation that ranks an individual's preferences over a set of goods and services.
Interest Rate
The share of a loan subject to interest charges to the borrower, typically denoted as an annual percentage of the loan's outstanding sum.
Nominal Interest Rate
The stated interest rate on a loan or investment, not adjusted for inflation.
Rational Consumer
An assumption in economics that consumers aim to maximize their utility or satisfaction from consumption choices, given their budget constraints.
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