Refer to the information provided in Figure 8.3 below to answer the question(s) that follow. Figure 8.3
-Refer to Figure 8.3. If total fixed costs are $100, then average total cost of producing 10 basketballs is
A) $2.
B) $10.
C) $13.
D) $130.

Question

Refer to the information provided in Figure 8.3 below to answer the question(s) that follow.  Figure 8.3
-Refer to Figure 8.3. If total fixed costs are $100, then average total cost of producing 10 basketballs is
A) $2. 
B) $10. 
C) $13. 
D) $130.

Quizplus · Accepted Answer

Average total cost (ATC) is calculated by dividing the total cost by the quantity produced. Without the specific figure (Figure 8.3) and additional details like variable costs, we can't calculate the exact total cost or ATC. However, given that the total fixed costs are $100, if we were to assume some level of variable costs that would add to the fixed costs, the ATC for producing 10 basketballs would be more than $10 (which would be the case if there were no variable costs at all). Therefore, without the variable costs or total costs provided, we can't accurately calculate the ATC, but it's clear that the ATC must account for both fixed and variable costs, making $13 a plausible choice given the options, assuming some level of variable costs exist. This explanation is based on general economic principles, as the specific details needed for an exact calculation are not provided.

Refer to the Information Provided in Figure 8