Total Fixed Costs for Excelsior Corporation Are $600,000

question 204

Multiple Choice

Total fixed costs for Excelsior Corporation are $600,000. Total costs, both fixed and variable, are $750,000 if 125,000 units are produced. The fixed cost per unit at 300,000 units would be

• A) $6.00/unit.
• B) $0.50/unit.
• C) $4.80/unit.
• D) $2.00/unit.

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Definitions:

Domestic Producers

Companies or individuals that produce goods or services within their home country.

Equilibrium Price

The cost at which the volume of goods available equals the volume sought by consumers.

Equilibrium Quantity

The amount of products or services available and sought after at the balance price.

Consumer Surplus

The divergence between the total price consumers are prepared to pay for a good or service and the actual price paid.