A Firm Is Producing 50 Units of Output at a Total

question 14

Multiple Choice

A firm is producing 50 units of output at a total cost of $1,000, with a per-unit variable cost of $8. What is the firm's average fixed cost?

• A) $12
• B) $4
• C) $20
• D) $28

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Definitions:

Sales

The process or activity of selling goods or services to customers.

Cash Discounts

Discounts earned by buyers who pay bills within a stated period.

Sterling Industries

A fictitious or placeholder name that could refer to a company involved in manufacturing, technology, or another sector.

Net 30

A payment term that indicates the invoice amount must be paid in full within 30 days from the invoice date.