Consider the following cost data:

$\begin{array} { | l | c | c | c | c | c | c | c | }
\hline \text { Output } & 0 & 1 & 2 & 3 & 4 & 5 & 6 \
\hline \text { Total Cost (\$) } & 24 & 33 & 41 & 48 & 54 & 61 & 69 \
\hline
\end{array}$
-The variable cost of producing 5 units of output is:
A)$61
B)$48
C)$37
D)$24
E)$5

Question

Consider the following cost data:

$\begin{array} { | l | c | c | c | c | c | c | c | } 
\hline \text { Output } & 0 & 1 & 2 & 3 & 4 & 5 & 6 \
\hline \text { Total Cost (\$) } & 24 & 33 & 41 & 48 & 54 & 61 & 69 \
\hline
\end{array}$
-The variable cost of producing 5 units of output is:
A)$61
B)$48
C)$37
D)$24
E)$5

Quizplus · Accepted Answer

Variable cost is calculated by subtracting the total cost at zero output from the total cost at the given level of output. For 5 units, the total cost is $61 and the total cost at 0 units (fixed cost) is $24. Therefore, the variable cost for 5 units is $61 - $24 = $37.

Consider the Following Cost Data -The Variable Cost of Producing 5 Units of Output Is