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If the excavation of the earth is done manually then it costs Rs. 10 per cum. A machine can excavate at fixed cost of Rs. 4000 plus a variable cost of Rs. 2 per cum. The quantity of earth for which the cost of excavation by machine will be equal to the cost of manual excavation is
1. 500 cum.
2. 1000 cum.
3. 1500 cum.
4. 2000 cum.

1 Answer

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Correct Answer - Option 1 : 500 cum.

Calculation:

Given, cost of excavation by manually = Rs. 10 per cum

Cost of the excavation by machine = Rs. 4000 + Rs. 2 per cm

Let the quantity of earth is ‘x’ for which the cost of excavation by machine will be equal to the cost of manual excavation

10x = 4000 + 2x

8x = 4000

x = 500 cum.

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