Exhibit 21-2 Refer to Exhibit 21-2. What is the average total cost of producing 90 units of output?
A)$4.75
B)$1.17
C)$1.07
D)$2.11
E)There is not enough information provided to answer the question.

Question

Exhibit 21-2  Refer to Exhibit 21-2. What is the average total cost of producing 90 units of output?
A)$4.75 
B)$1.17 
C)$1.07 
D)$2.11 
E)There is not enough information provided to answer the question.

Quizplus · Accepted Answer

To calculate average total cost (ATC), we need to divide the total cost (TC) by the output quantity (Q).
At Q=90, we can see from the graph that the TC is approximately $190.
Therefore, ATC = TC/Q = $190/90 = $2.11. 
Hence, the best answer choice is (D).