Answer the question on the basis of the following cost data. $\begin{array} { | c | c | c | }
\hline \text { Output } & \text { Average Fixed Cost } & \text { Average Variable Cost } \
\hline 1 & \$ 50.00 & \$ 100.00 \
\hline 2 & 25.00 & 80.00 \
\hline 3 & 16.67 & 66.67 \
\hline 4 & 12.50 & 65.00 \
\hline 5 & 10.00 & 68.00 \
\hline 6 & 8.37 & 73.33 \
\hline 7 & 7.14 & 80.00 \
\hline 8 & 6.25 & 87.50 \
\hline
\end{array}$ The average total cost of five units of output is

Question

Answer the question on the basis of the following cost data. $\begin{array} { | c | c | c | } 
\hline \text { Output } & \text { Average Fixed Cost } & \text { Average Variable Cost } \
\hline 1 & \$ 50.00 & \$ 100.00 \
\hline 2 & 25.00 & 80.00 \
\hline 3 & 16.67 & 66.67 \
\hline 4 & 12.50 & 65.00 \
\hline 5 & 10.00 & 68.00 \
\hline 6 & 8.37 & 73.33 \
\hline 7 & 7.14 & 80.00 \
\hline 8 & 6.25 & 87.50 \
\hline
\end{array}$ The average total cost of five units of output is

Quizplus · Accepted Answer

To find the average total cost, we need to add the average fixed cost and the average variable cost for a given level of output (in this case, 5 units) and divide by the output.

So, for 5 units of output, the average fixed cost is $10 ($50/5) and the average variable cost is $68. Therefore, the average total cost for 5 units of output is $78 ($10 + $68).

Option B is the only choice that matches this result.

Answer the Question on the Basis of the Following Cost