If Total Cost Equals $2,000 and Quantity Produced Is 100

question 13

Multiple Choice

If total cost equals $2,000 and quantity produced is 100 units,then

• A)fixed cost is $200 and average variable cost is $18.
• B)fixed cost is $600 and average variable cost is $14.
• C)fixed cost is $500 and marginal cost is $15.
• D)Either A or B can be correct.

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Definitions:

Times-Interest-Earned Ratio

A fiscal indicator that evaluates a firm's capacity to satisfy its debt commitments utilizing its present income.

Operating Costs

Expenditures that are necessary for the day-to-day operations of a business, including costs related to manufacturing, sales, and administration.

Interest Charges

Interest charges are the costs incurred by an entity for borrowing money, quantified as a percentage of the principal loan amount.

Assets

Economic resources or owned items of value that an individual, corporation, or country possesses, expected to provide future benefits.