Exhibit 7-5

-In Exhibit 7-5, what are variable costs at 15 units of output?
A) $30
B) $10
C) $1
D) $20
E) it is impossible to calculate variable cost unless we know the daily wage

Question

Exhibit 7-5
 
-In Exhibit 7-5, what are variable costs at 15 units of output?
A) $30 
B) $10 
C) $1 
D) $20 
E) it is impossible to calculate variable cost unless we know the daily wage

Quizplus · Accepted Answer

At 15 units of output, the variable cost is $20. This can be calculated by finding the point where the total cost curve intersects the 15 unit output line and then subtracting the fixed cost at that point. An additional piece of information, such as the daily wage, is not necessary to calculate variable cost.

Exhibit 7-5 -In Exhibit 7-5, What Are Variable Costs at 15 Units