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1. It takes a phlebotomist 15 minutes to complete a blood draw. The supplies for each draw cost $4, and the phlebotomist earns $20 per hour. The phlebotomy lab designed to accommodate 20,000 draws per year. Its rent is $80,000 per year. What are the average and incremental costs of a blood draw when the volume is 20,000? 10,000? What principle does your calculation illustrate?
2. How would the average and marginal costs change if the phlebotomist’s wage rose to $24 per hour? What principle does your calculation illustrate?
3. A new computer lets the phlebotomist complete a blood draw in 10 minutes. The supplies for each draw cost $4, and the phlebotomist earns $20 per hour. The phlebotomy lab is designed to accommodate 20,000 draws per year. Its rent is $80,000 per year. What is the marginal cost of a blood draw? What principle does your calculation illustrate?
4. Use the data in Exercise 5.7. How would the average and marginal costs change if the rent rose to $100,000? What principle does your calculation illustrate?
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