Suppose That a Donut Shop Has $1,500 of Variable Costs

question 65

Multiple Choice

Suppose that a donut shop has $1,500 of variable costs and $2,500 of fixed costs when it produces 1,000 donuts and sells them for $1 per donut.Average total cost is equal to

• A) $1.50.
• B) $2.00.
• C) $4.00.
• D) $25.00.

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Definitions:

Criteria

Standards or principles by which something is judged or decisions are made.

Nominal Group Technique

A structured method for group brainstorming that encourages contributions from all members and seeks to minimize the influence of dominant personalities.

Roundtable Discussion

A meeting format where participants, often experts or stakeholders, gather to discuss topics in an open and equal manner, usually seated at a round table to symbolize no hierarchical structure.

Elaboration Likelihood Model

A theory in psychology that explains how the persuasion of a message depends on the likelihood of cognitive processing by the receiver.