A hotel pays the phone company $200per month plus $

a) Computation of Hotel's Phone Bills for January and February:

For January = (7,000*$0.15)+$200 = $1,050+$200 = $1,250

For February = (8,000*$0.15)+$200 = $1,200+$200 = $1,400

b) Computation of Cost per Phone Call in January and in February:

Cost per phone call in January = $1,250/7,000 = $0.18 per phone call

Cost per phone call in February = $1,400/8,000 = $0.18 per phone call

c) Separation of the January phone bill into its fixed and variable components:

Fixed = $200

Variable = 7,000*$0.15 = $1,050

d) Computation of marginal cost of one additional phone call in January:

Since each phone call cost $0.15, the marginal cost of making one additional call in January is $0.15

e) Computation of Average Cost of a Phone Call in January:

Average Cost of a Phone Call in January = ((7,000*$0.15)+$200)/7,000 = $1,250/7,000 = $0.18