If a Firm Produces 20 Units of Output and Incurs

question 191

Multiple Choice

If a firm produces 20 units of output and incurs a total cost of $1,000 and a variable cost is $700, calculate the firm's average fixed cost of production if it expands output to 25 units.

• A)$300
• B)$15
• C)$12
• D)It is impossible to determine without additional information.

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Definitions:

Grams

A metric unit of mass equal to one thousandth of a kilogram.

Mass

A measure of the amount of matter in an object, often quantified in units like kilograms or grams.

Material

Substance or substances out of which a thing is or can be made.

Nonliving Things

Objects or substances that do not possess life, characterized by an inability to grow, metabolize, respond to stimuli, reproduce, or adapt.