Problem 6-35 Cost Behavior Patterns in a Variety of Settings; International Issues (LO 6-1, 6-2)

For each of the cost items described below, choose the graph (a through l) that best represents it.

1.	The cost of utilities at a university. For low student enrollments, utility costs increase with enrollment, but at a decreasing rate. For large student enrollments, utility costs increase at an increasing rate.
2.	The cost of on-line back-up storage at a rate of $2.50 per gigabyte, up to 50 gigabytes, beyond which storage is unlimited.
3.	The cost of outsourcing diagnostic blood testing by a hospital. The hospital pays an independent lab a fee of $1,000 per month plus $3 for each test done.
4.	The salary costs of the shift supervisors at a truck depot. Each shift is eight hours. The depot operates with one, two, or three shifts at various times of the year.
5.	The salaries of the security personnel at a factory. The security guards are on duty around the clock.
6.	The wages of table-service personnel in a restaurant. The employees are part-time workers, who can be called upon for as little as two hours at a time.
7.	The cost of electricity during peak-demand periods is based on the following schedule.

Up to 10,000 kilowatt-hours (kWh)	$	0.09	per kWh
Above 10,000 kilowatt-hours	$	0.12	per kWh

The price schedule is designed to discourage overuse of electricity during periods of peak demand.

8.	The cost of sheet metal used to manufacture automobiles.
9.	The cost of chartering a private airplane. The cost is $410 per hour for the first three hours of a flight. Then the charge drops to $305 per hour.
10.	Under a licensing agreement with a South American import/export company, your firm has begun shipping machine tools to several countries. The terms of the agreement call for an annual licensing fee of $95,000 to be paid to the South American import company if total exports are under $4,500,000. For sales in excess of $4,500,000, an additional licensing fee of 9 percent of sales is due.
11.	Your winery exports wine to several Pacific Rim countries. In one nation, you must pay a tariff for every case of wine brought into the country. The tariff schedule is the following:

0 to 6,000 cases per year	$	11	per case
6,001 to 12,000 cases per year	$	14	per case
Above 12,000 cases per year	$	19	per case