If fixed costs are $200,000 and variable costs are $30 per unit over the relevant range of output, when 10,000 units are produced, the average total cost will be
A) $20.
B) $30.
C) $50.
D) $70.

Question

Quizplus · Accepted Answer

Average total cost = (Fixed costs + Variable costs) / Number of units produced= (200,000 + 30 * 10,000) / 10,000= (200,000 + 300,000) / 10,000= 500,000 / 10,000= $50

If Fixed Costs Are $200,000 and Variable Costs Are $30