Suppose that real domestic output in an economy is 20 units, the quantity of inputs is 10, and the price of each input is $4.The per unit cost of production in the economy described above is:
A)$.50.
B)$1
C)$2
D)$5

Question

Quizplus · Accepted Answer

Per unit cost of production = Total cost / Total output
Total cost = Quantity of inputs x Price of each input = 10 x $4 = $40
Per unit cost of production = $40 / 20 units = $2 per unit. Therefore, the correct answer is C.

Suppose That Real Domestic Output in an Economy Is 20