Jon Krechen is currently earning $2400.00 per month working full time as a compu
ID: 1148465 • Letter: J
Question
Jon Krechen is currently earning $2400.00 per month working full time as a computertechnical support person for a college situated in Winnipeg. He lives in a one-bedroom apartment and pays S600.00 per month in rent. Jon's monthly living expenses, including food, personal care, taxes, insurance, and entertainment expenses, are $1700.00 per month. Jon pays $75.00 per month for a bus pass since he does not own a car. Jon wants to estimate the extra costs related to the possible decision of enrolling full time in an intensive two-month computer networking course in Winnipeg. While taking the course, Jon will be on a two-month leave without pay. He will continue to live in his one-bedroom apartment, and he will travel by bus to the training centre offering the computer course. He estimates that the monthly living expenses will not change during his leave. Tuition, fees, and books related to taking the course amount to $5500.00. The marginal cost of Jon Krechen's decision to enroll in the two-month course, as described above, is equal to S(Round your response to the nearest dollar)Explanation / Answer
Current Earning of Jon Krechen : $2400 per month
Monthly rent of the apartment : $600 permonth
Monthly expenses of Jon : $1700 per month
Bus Pass expenses : $75.00 per month
Total Monthly expenses of Jon = 600 + 1700 + 75 = $2375 per month
Expenses of Jon if he enrolls for the course
Loss of two months salary : 2 * 2400 = $4800
Tuition, fees and books expenses : $5500
So,Total Cost incurred by Jon if he enrolls for the program =5500 + 4800 + 4750 = $10100
Marginal Cost =Change in Cost / Change in period
= 10100 - 4750
= $5350 for 2 months
5350/ 2
= $2675 for 1 month.
The marginal cost of Jon Krechen's decision to enroll in the two-months course, as described above is equal to $5350 for two months or $2675 for 1 month.
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