The Shelly Group has leased a new copier that costs $1,100 per month plus $0.05 for each copy. What is the total cost if Shelly makes 5,500 copies a month? If it makes 9,500 copies a month? What is the per-copy cost at 5,500 copies? At 9,500 copies?

The correct answer for 5500 copies is $1,375 and $0.25 and for 9500 copies is $1,575 and $0.17.

Explanation:

According to the scenario, the given data are as follows:

Fixed Cost of new copier = $1,100

Variable cost = $0.05

So, we can calculate the total cost and per copy cost by using following formula:

Total Cost = Fixed cost + (Variable cost * Number of copies)

Per copy cost = Total Cost : Number of copies

For 5,500 copies,

By putting the value, we get

Total cost = $1,100 + ($0.05 * 5,500)

= $1,100 + (275)

= $1,375

Now, Per copy cost = $1,375 : 5,500

= $0.25

For 9,500 copies,

By putting the value, we get

Total cost = $1,100 + ($0.05 * 9,500)

= $1,100 + (475)

= $1,575

Now, Per copy cost = $1,575 : 9,500

= $0.17

Hence, the total cost and per copy cost for 5,500 copies is $1,375 and $0.25 and total cost and per copy cost for 9,500 copies is $1,575 and $0.17.