You are the manager of a gym, and you have to decide how many customersto admit each
Chapter 0, Problem 6(choose chapter or problem)
You are the manager of a gym, and you have to decide how many customersto admit each hour. Assume that each customerstays exactly one hour. Customers are costly to admit because they inflict wear and tear on the exercise equipment. Moreover, each additional customer generates more wear and tear than the customer before. As a result, the gym facesincreasing marginal cost. The accompanying table shows the marginal cost associated with each number of customers per hour. a. Suppose that each customer pays $15.25 for a one-hour workout. Use the principle of marginal analysis to find the optimal number of customers that you should admit per hour. b. You increase the price of a one-hour workout to $16.25. What is the optimal number of customers per hour that you should admit now?
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