In an economy, it costs $1,500 to produce 2,000 units of output. If the costs increase to $2,500, then the per unit cost of production will have increased from
A) $0.75 to $1.25.
B) $0.75 to $1.00.
C) $1.33 to $1.75.
D) $0.80 to $1.33.

Question

Quizplus · Accepted Answer

Initially, the per unit cost is $1,500 / 2,000 units = $0.75. With the increase, the per unit cost becomes $2,500 / 2,000 units = $1.25.

In an Economy, It Costs $1,500 to Produce 2,000 Units