Average variable cost equals
A)average total cost plus average fixed cost.
B)total variable cost divided by the change in output.
C)total variable cost divided by output.
D)price of the variable input times the quantity of the variable input.

Question

Quizplus · Accepted Answer

Average variable cost can be calculated by dividing the total variable cost by the level of output. Therefore, option C is the correct choice. Option A is incorrect because it adds fixed cost to average total cost, which is not related to variable cost. Option B is incorrect because it divides total variable cost by the change in output, which would give us marginal variable cost, not average variable cost. Option D is incorrect because it multiplies the price of the variable input by the quantity of the variable input, which gives us the total cost of the variable input, not the average variable cost.

Average Variable Cost Equals