Vipsana's Gyros House sells gyros.The cost of ingredients (pita, meat, spices, etc.)to make a gyro is $2.00.Vipsana pays her employees $60 per day.She also incurs a fixed cost of $120 per day.Calculate Vipsana's average fixed cost per day when she produces 50 gyros using two workers?
A)$2.00
B)$2.40
C)$4.40
D)$6.80

Question

Quizplus · Accepted Answer

The average fixed cost is calculated by dividing the total fixed costs by the number of units produced. Vipsana's fixed costs are $120 per day. When she produces 50 gyros, the average fixed cost per gyro is $120 / 50 = $2.40.

Vipsana's Gyros House Sells Gyros