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The fixed cost of producing 100 units of a good is $600. If the variable...

Economics
WAEC 2024

The fixed cost of producing 100 units of a good is $600. If the variable cost is $400. the average total cost of one unit of the good is

  • A. $4
  • B. $6
  • C. $8
  • D. $10
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Correct Answer: Option D
Explanation

( Average total cost) = ( average fixed cost) + ( average vairable cost)

 

\(\frac{\text{totalcost}}{\text{quantity}}\) + \(\frac{\text{(total variable cost)}}{\text{quantity}}\)

\(\frac{$600}{100}\) + \(\frac{$400}{100}\)

= $6 + $4 = $10


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