If a Firm Produces 8 Units of Output with Average

question 43

Multiple Choice

If a firm produces 8 units of output with average fixed cost=$40 and average variable cost=$25,what is its average cost?​

• A)​$32
• B)$20
• C)$65
• D)​$100

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Definitions:

Actual Results

Actual results refer to the final outcomes or data obtained after completing a process or experiment, measured against predetermined objectives or expectations.

Variable Overhead Efficiency Variance

The difference between the actual and standard cost of variable overhead based on the efficient use of production resources.

Machine-Hours

A measure of production output or activity based on the total hours machines are operated in the manufacturing process.

Overhead Rate

A calculation used to allocate indirect costs to products or services, typically expressed as a rate per unit of activity (e.g., labor hours or machine hours).