If total cost equals $2,000 and quantity produced is 100 units,then
A)fixed cost is $200 and average variable cost is $18.
B)fixed cost is $600 and average variable cost is $14.
C)fixed cost is $500 and marginal cost is $15.
D)Either A or B can be correct.

Question

Quizplus · Accepted Answer

The total cost provided does not give enough information to uniquely determine the fixed cost and the average variable cost without additional information about either the variable costs or how costs change with production levels. Both A and B could be correct with different underlying cost structures.

If Total Cost Equals $2,000 and Quantity Produced Is 100