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Homework answers / question archive / Ray hires students to clean houses at $400 a week
Ray hires students to clean houses at $400 a week. He leases equipment that costs $300 a week.
The table gives Ray's total product and total cost schedules.
At what output is Ray's average total cost at a minimum?
| Labor | Total Product | Total Cost |
|---|---|---|
| 0 | 9 | 300 |
| 1 | 2 | 700 |
| 2 | 5 | 1100 |
| 3 | 9 | 1500 |
| 4 | 12 | 1900 |
| 5 | 14 | 2200 |
| 6 | 15 | 2700 |
If your quantities have the same average total cost, we take the average quarterly, like that at the minimum average total cost.
Ray's average total cost is at minimum when he cleans _____ houses in a week.
| Labor | Total Product | Total Cost | Average total cost |
|---|---|---|---|
| 0 | 9 | 300 | 0 |
| 1 | 2 | 700 | 350 |
| 2 | 3 | 1100 | 183 |
| 3 | 9 | 1500 | 56 |
| 4 | 12 | 1900 | 40 |
| 5 | 14 | 2300 | 33 |
| 6 | 15 | 2700 | 30 |
So, the Average total cost is minimum at 15 houses in a week.
