Bayside Apartments is a 900 unit apartment complex When the

Last updated: 10/17/2023

Bayside Apartments is a 900 unit apartment complex When the apartments are 90 occupied monthly operating costs total 229 840 When occupancy dips to 80 monthly operating costs fall to 224 080 The owner of the apartment complex is worried because many of the apartment residents work at a nearby manufacturing plant that has just announced it will close in three months The apartment owner fears that occupancy of her apartments will drop to 60 if residents lose their jobs and move away Assuming the same relevant range what can the owner expect her operating costs to be if occupancy falls to 60 Let s begin by determining the formula that is used to calculate the variable cost slope Change in cost Change in volume Variable cost slope Now determine the formula that is used to calculate the fixed cost component Total operating cost Total variable cost Use the high low method to determine Bayside s operating cost equation y 64 x 178 000 Assuming the same relevant range what should the owner expect her operating costs to be if occupancy falls to 60 Round your answer to the nearest whole dollar The owner should expect her operating costs to be if occupancy falls to 60 Fixed cost Save