Two new rides are being compared by a local amusement park in terms of their ann

Question

Two new rides are being compared by a local amusement park in terms of their annual operating costs. The two rides are assumed to be able to generate the same level of revenue (and thus the focus on costs). The tummy tugger has fixed costs of $10,000 per year and variable costs of $2.50 per visitor. The head buzzer has fixed costs of $4000 per year, and variable cost of $4 per visitor.

Mathematically determine the breakdown number of visitors per year for the two rides:

10,000 visitors

2,500 visitors

4,000 visitors

400 visitors

10,000 visitors

2,500 visitors

4,000 visitors

400 visitors

Explanation / Answer

fixed costs of $10,000 per year and variable costs of $2.50

The head buzzer has fixed costs of $4000 per year, and variable cost of $4 per visito

Use the slope-intercept form to generate the cost equations (or inequalities).

y = mx + b

The y-intercept for each is the fixed cost.

The variable cost is the slope and the independent variable (x) is the number of customers.

CTugger = 2.50x + 10000

CBuzzer = 4.00x + 4000

Solve the system to determine the customer load where costs are equal.

2.50x + 10000 = 4.00x + 4000

6000 = 1.5x

x = 4000

the break down number of vistors are 4000 visitors per year.

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