A Firm Produces 400 Units of Output at a Total

question 226

Multiple Choice

A firm produces 400 units of output at a total cost of $1,200. If fixed costs are $200,

• A)average fixed cost is $2.
• B)average variable cost is $2.50.
• C)average total cost is $4.
• D)average total cost is $5.

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Definitions:

Note

A promise by the maker of the note to pay the payee of the note.

Bank

A financial institution licensed to receive deposits, offer loans, and provide various financial services to individuals and businesses.

Negotiable Instruments

Financial documents that guarantee the payment of a specified sum of money, either on-demand or at a set time.

Uniform Commercial Code

A comprehensive set of laws governing all commercial transactions in the United States, intended to standardize statutes across the states to facilitate easier interstate commerce.