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a. Firm A is producing 20,000 units of output, incurring a total cost of $2,000,000 and total variable cost of $400,000. What is Firm A's average fixed cost? per unit b. Firm B is producing 20,000 units of output, incurring a total cost of $200,000 and total fixed cost of $20,000. What is Firm B's average variable cost? per unit c. Firm C is producing 650 units of output. Average variable cost is $30 per unit and average fixed cost is $25 per unit. What is Firm C's total cost?

a. Firm A is producing 20,000 units of output, incurring a total cost of $2,000,000 and total variable cost of $400,000. What is Firm A's average fixed cost? per unit b. Firm B is producing 20,000 units of output, incurring a total cost of $200,000 and total fixed cost of $20,000. What is Firm B's average variable cost? per unit c. Firm C is producing 650 units of output. Average variable cost is $30 per unit and average fixed cost is $25 per unit. What is Firm C's total cost?

ECON MICRO
ECON MICRO
5th Edition
ISBN:9781337000536
Author:William A. McEachern
Publisher:William A. McEachern
Chapter7: Production And Cost In The Firm
Section: Chapter Questions
Problem 3.7P
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Each of the following situations describes a firm's production and costs during a given year. Complete parts (a) through (e) below. C a. Firm A is producing 20,000 units of output, incurring a total cost of $2,000,000 and total variable cost of $400,000. What is Firm A's average fixed cost? S per unit b. Firm B is producing 20,000 units of output, incurring a total cost of $200,000 and total fixed cost of $20,000. What is Firm B's average variable cost? per unit c. Firm C is producing 650 units of output. Average variable cost is $30 per unit and average fixed cost is $25 per unit. What is Firm C's total cost? d. Firm D is producing 500 units of output. Average total cost is $12 and average fixed cost is $8. What is Firm D's total variable cost? e. Firm E is producing 800,000 units of output, incurring a total cost of $50 million and total variable cost of $45 million. What is Firm E's average fixed cost? per unit
Transcribed Image Text:Each of the following situations describes a firm's production and costs during a given year. Complete parts (a) through (e) below. C a. Firm A is producing 20,000 units of output, incurring a total cost of $2,000,000 and total variable cost of $400,000. What is Firm A's average fixed cost? S per unit b. Firm B is producing 20,000 units of output, incurring a total cost of $200,000 and total fixed cost of $20,000. What is Firm B's average variable cost? per unit c. Firm C is producing 650 units of output. Average variable cost is $30 per unit and average fixed cost is $25 per unit. What is Firm C's total cost? d. Firm D is producing 500 units of output. Average total cost is $12 and average fixed cost is $8. What is Firm D's total variable cost? e. Firm E is producing 800,000 units of output, incurring a total cost of $50 million and total variable cost of $45 million. What is Firm E's average fixed cost? per unit
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