Imagine that you are an entrepreneur,making designer t-shirts in your garage.Your accountant has estimated that your firm's total costs can be expressed by the function TC = 300 + 10 × Q,where Q represents the number of t-shirts you make.
Given the total cost function TC = 2,000 + 2 × Q,when output is 1,000 units average total costs are __________ and total fixed costs is __________.

Question

Quizplus · Accepted Answer

When Q = 1,000 total cost = 2,000 + 2 × 1,000 = 4,000.Average total cost is total cost divided by Q,here 4,000/1,000 = 4.Fixed costs are $2,000 regardless of the value of Q.

Imagine That You Are an Entrepreneur,making Designer T-Shirts in Your