Question

"Suppose a very successful entrepreneur earns $5,000 every hour that she spends working. As part of her business, she needs to travel to different locations. For a particular trip, which takes 3 hours of total flight time, she can either rent a private jet or travel there on a commercial airline. The private jet costs $10,000 per trip, but there is virtually no wait time; she can arrive to the airport and leave immediately. Whereas the commercial airline costs $500 per ticket, but she has to arrive to the airport two hours before her flight. Suppose that she can work on the airplane in either case. With this information, we can assert that:"

		The total cost of flying on the commercial airline is lower than the total cost of flying on the private jet.
		The total cost of flying on the commercial airline equal to the total cost of flying on the private jet.
		The total cost of flying on the commercial airline is higher than the total cost of flying on the private jet.
		None of the available options are correct.

Answer 1

Ans - The total cost of flying on the commercial airline is higher than the total cost of flying on the private jet.

Explanation:

When she choose commercial airline it cost her = $10,500

= 2*5000 = 10,000 ( as the waiting time of 2 hours and at this time she can work and earn $5000 each hour)

+ $500 ( as ticket cost her $500) .

When she choose private jet, it cost her only $10,000

As $10,500> $10,000

So the  total cost of flying on the commercial airline is higher than the total cost of flying on the private jet.