Total Fixed Costs for Herman Enterprises Are $200,000

question 111

Multiple Choice

Total fixed costs for Herman Enterprises are $200,000.Total costs,both fixed and variable,are $550,000 if 100,000 units are produced.The variable cost per unit is:

• A)$2.00/unit.
• B)$7.50/unit.
• C)$3.50/unit.
• D)$5.50/unit.

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Definitions:

Total Product

The total output of goods or services produced by a firm during a given period of time.

Diminishing Marginal Returns

A principle stating that as more of a production input is added, holding all others constant, the resulting additional output will eventually decrease.

Range

The difference between the highest and lowest values in a data set, often used to measure variability.

Average Product

The output per unit of input, typically calculated for labor or capital in the production process.