Question

# Problem 1: Using the Marginal Approach Suppose your company runs a...

Problem 1: Using the Marginal Approach

Suppose your company runs a shuttle business of a hotel to and from the local airport. The costs for different customer loads are:

1 customer: \$30

2 customers: \$32

3 customers: \$35

4 customers: \$38

5 customers: \$42

6 customers: \$48

7 customers: \$57

8 customers: \$68.

1. What are your marginal costs for each customer load level? (Chart)

2. If you are compensated \$10 per ride, what customer load would you choose? (Essay)

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