The average fixed cost of a firm equal:

Question

Quizplus · Accepted Answer

The average fixed cost (AFC) of a firm is the fixed costs divided by the output. Fixed costs are the costs that a firm incurs regardless of the level of output, and include items such as rent, depreciation, and insurance. Total fixed costs are equal to the difference between total cost and total variable cost at any given level of output. Therefore, the formula for AFC is (Total fixed costs) / (Output), or (Total cost - Total variable cost) / (Output), which is option D.

The Average Fixed Cost of a Firm Equal