If total cost at quantity = 0 is $100 and total cost at quantity = 10 is $500,then average variable cost at quantity = 10 is _____
A)$500.
B)$400.
C)$50.
D)$40.
E)$10.

Question

Quizplus · Accepted Answer

We can use the formula for calculating average variable cost:

Average Variable Cost = Variable Cost / Quantity

To find the variable cost, we subtract the fixed cost from the total cost:

Variable Cost = Total Cost - Fixed Cost
Variable Cost = $500 - $100
Variable Cost = $400

Now we can calculate the average variable cost at quantity = 10:

Average Variable Cost = $400 / 10
Average Variable Cost = $40

Therefore, the answer is D) $40.

If Total Cost at Quantity = 0 Is $100 and Total