Question

At your local family fun center, miniature golf is $12 per person for unlimited rounds in a day, while each go-kart session is $8. If you played 3 rounds of miniature golf and rode the go-karts 3 times,

a) what was the marginal cost of the first round of miniature golf?

b) what was the marginal cost of the third round of miniature golf?

c) what was the marginal cost of the first go-kart session?

d) what was the marginal cost of the third go-kart session?

Answer 1

(a) The marginal cost of the first round of miniature golf= $12.

(b) The total cost of the 2 rounds of miniature golf = $12 ,the total cost of 3 rounds of miniature golf = $12 because it is given that after paying only $12 , they can enjoy unliited rounds of miniature golf. This implies that the marginal cost of the third round of miniature golf = $(12-12)= $0.

(c) Marginal cost of the first go-kart session = $8.

(d) The total cost of the 2 go-kart sessions= $(2)(8)= $16 ,the total cost of 3 go-kart sessions= $(3)(8)= $24 . This implies that the marginal cost of the third go-kart session = $(24-16)= $8.