A firm's total fixed cost equals $2500. What would the firm's average fixed cost be at 10 units of output?
A) $2.50
B) $250
C) $2500
D) $25 000

Question

Quizplus · Accepted Answer

The average fixed cost is calculated by dividing the total fixed cost by the level of output. In this case, the total fixed cost is $2500 and the level of output is 10 units. Therefore, the average fixed cost at 10 units of output is $250 ($2500 divided by 10).

A Firm's Total Fixed Cost Equals $2500