- Math
Problems: Recycling Economics
- Adapted from Classroom Activities,
Office of Community Development, Waste Recycling and Reduction,
Augusta, ME
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Back to Trash Goes to School
- GRADE LEVELS:
7-8
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- SUBJECT AREAS:
math, economics, business
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- CONCEPT:
Fixed and variable costs.
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- OBJECTIVE:
To study the economics of business, using recycling as an example.
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- MATERIALS:
- handout: Math
Problems: Recycling Economics
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- KEYWORDS:
fixed costs, variable costs, cost avoidance
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- BACKGROUND:
Recycling is essentially a new business; it has been done for
years but only where convenient and economically profitable.
Now we are facing problems because we produce so much garbage.
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- We are now implementing recycling laws,
and we are finally starting to pay the real cost of disposal.
Recycling is becoming a very popular cost-avoidance method of
disposal.
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- PROCEDURE:
Explain the ideas of fixed costs, variable costs, and cost avoidance,
and have the students complete the problems on the following
pages.
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- Answers:
- 1. Fixed costs may include insurance,
labor, rent, heat, telephone, taxes and advertising. Fixed costs
remain unchanged, no matter how much business is done.
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- 2. Variable costs may include labor,
electricity, gasoline and repairs. The longer you operate machinery,
the more fuel or electricity it needs and the faster it wears
out. Variable costs rise and fall as business increases or decreases.
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- 3. $1,200 / 60,000 lbs. = 2 cents/lb.
5 cents/lb. - 2 cents/lb. = 3 cents/lb.
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- 4. $1,200 / 120,000/lb. = 1 cent/lb.
5 cents/lb. - 1 cent/lb. = 4 cents/lb.
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- 5. Doubling the number of pounds of
cans processed has cut in half the fixed cost per pound, resulting
in an increase in the amount of money available for variable
cost and profit.
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- Suppose variable costs added another
2 cents per pound of expenses. Profit would be 1 cent per pound
if 60,000 pounds were processed, 2 cents per pound if 120,000
pounds were processed.
- Math Problems: Recycling Economics
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- Most recycling business expenses are
fixed costs. These costs remain the same no matter how many pounds
of cans the center collects per month.
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- Other expenses depend on how many cans
the center collects. These are called variable costs.
- 1. Can you list some examples of fixed
costs that a recycling center might have?
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- 2. Can you list some examples of variable
costs that a recycling center might have?
____________________________________________________________________________________
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- 3. If a recycling center's fixed costs
total $1,200 a month and 60,000 pounds are being processed, how
much is being spent per pound for fixed cost?
_____________________________________________
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- How much per pound is left for variable
cost and profit out of a 5 cent per pound difference between
the amount paid can collectors and the amount received from an
aluminum company?
_____________________________________________
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- 4. If the center can process 120,000
pounds a month without increasing fixed costs of $1,200, how
much is then being spent per pound for fixed costs?
_____________________________________________
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- How much per pound is left for variable
costs and profit?
_____________________________________________
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- 5. Can you explain why a recycling
business may earn more money as the number of cans collected
increases?
______________________________________________________________________________________
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