-The Jerry-Berry Ice Cream Shoppe's total cost schedule is in the above table.Based on the table,which of the following is correct?
A) The total fixed cost is $1.
B) The average fixed cost of 1 gallon is $1.00.
C) The average variable cost of 2 gallons of ice cream is $1.00 per gallon.
D) Only answers A and B are correct.
E) Answers A, B, and C are correct.

Question

-The Jerry-Berry Ice Cream Shoppe's total cost schedule is in the above table.Based on the table,which of the following is correct?
A) The total fixed cost is $1. 
B) The average fixed cost of 1 gallon is $1.00. 
C) The average variable cost of 2 gallons of ice cream is $1.00 per gallon. 
D) Only answers A and B are correct. 
E) Answers A, B, and C are correct.

Quizplus · Accepted Answer

The total fixed cost remains constant regardless of the output level, which is indicated by the cost that does not change when production is zero. The average fixed cost for any quantity is the total fixed cost divided by the number of units produced, which decreases as production increases. The average variable cost is the total variable cost divided by the quantity produced, which can be calculated for any given level of output.

-The Jerry-Berry Ice Cream Shoppe's Total Cost Schedule Is in the Above