sandy wrote:
A company’s annual expenses are composed entirely of a fixed amount in costs, plus a variable amount that is directly proportional to the number of clients served. In 2009, the company served 450 clients and its total expense was $830,000. In 2010, the company served 510 clients and its total expense was $896,000. What is the company’s fixed annual expense, in dollars?
(A) 1,844
(B) 1,757
(C) 335,000
(D) 485,000
(E) 830,000
Given: Total expenses = (# of clients)(fixed expense per client) + Fixed amount
Let x = fixed expense per client
Let F = fixed amount
So, Total expenses = (# of clients)x + F
Or... (# of clients)x + F = TOTAL expenses
In 2009, the company served 450 clients and its total expense was $830,000.450x + F = 830,000In 2010, the company served 510 clients and its total expense was $896,000510x + F = 896,000We have:
510x + F = 896,000450x + F = 830,000Subtract bottom equation from top to get: 60x = 66,000
Solve to get: x = 1100
To find the value of F, take
510x + F = 896,000 and replace x with 1100
We get: (510)(1100) + F = 896,000
561,000 + F = 896,000
Solve: F = 335,000
Answer: