Charles's Car Wash has average variable costs of $2 and average fixed costs of $3 when it produces 100 units of output (car washes).The firm's total cost is

Question

Quizplus · Accepted Answer

Total cost is calculated by adding total variable costs and total fixed costs. Total variable costs are average variable costs multiplied by the quantity of output ($2 * 100 = $200). Total fixed costs are average fixed costs multiplied by the quantity of output ($3 * 100 = $300). Therefore, total cost is $200 + $300 = $500.

Charles's Car Wash Has Average Variable Costs of $2 and Average