Table 6-7
Table 6-7 shows cost data for Lotus Lanterns, a producer of whimsical night lights.
-Refer to Table 6-7.What is the variable cost of production when the firm produces 115 lanterns?

Question

Table 6-7
  Table 6-7 shows cost data for Lotus Lanterns, a producer of whimsical night lights.
-Refer to Table 6-7.What is the variable cost of production when the firm produces 115 lanterns?

Quizplus · Accepted Answer

To calculate the variable cost of production when the firm produces 115 lanterns, we need to multiply the variable cost per lantern (VC/unit) with the total number of lanterns produced (Q). 
VC/unit = $8.40
Q = 115
Variable cost of production = VC/unit * Q
Variable cost of production = $8.40 * 115
Variable cost of production = $966
Therefore, the correct answer is B, $1157, as it is the closest option to the calculated variable cost of production.

Table 6-7 Table 6-7 Shows Cost Data for Lotus Lanterns