Gut Bombs sandwich shop pays $5,000 a month in rent space and equipment. It pays each of its 10 workers $2,500 a month and spends $5,000 on food. There are no other production costs. Usually the shop sells 3,500 sandwiches per month for $10 each. The shop could hire another worker and increase the number of sandwiches it makes by 300. Assuming a constant food cost per sandwich of $1.43, their marginal cost per month per sandwich, of making 300 more sandwiches per month, rounded to the nearest penny, is

Respuesta :

The marginal cost per month per sandwich of making 300 additional sandwiches per month for Gut Bombs is $9.76.

What is marginal cost?

The marginal or incremental cost is the increase or decrease in the cost of producing one more unit.

Data and Calculations:

Food cost per month = $1.43

Monthly wages per worker = $2,500

Marginal cost = $2,929 ($1.43 x 300 + $2,500)

Marginal cost per unit = $9.76 ($2,929/300)

Thus, the marginal cost per month per sandwich of making 300 additional sandwiches per month for Gut Bombs is $9.76.

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