Suppose a Firm Is Producing 10 000 Units of Output

question 107

Multiple Choice

Suppose a firm is producing 10 000 units of output.At this level of output,average total cost is $200 and average fixed cost is $20.It can be concluded that total variable cost is

• A)$1800.
• B)$18 000.
• C)$1 800 000.
• D)$ 180 000.
• E)$180.

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Definitions:

Specific Financing

Financing that is intended for a particular purpose or project, with clear specifications and usually backed by specific collateral.

After-Tax Cost

The expense of any financial obligation or investment after accounting for the effects of taxes.

Project Evaluation

The process of determining the potential successes or failures of a proposed project based on various criteria.

DCF Approach

A valuation method that estimates the value of an investment based on its expected future cash flows, adjusted for the time value of money.