At Jody's bakery they are currently selling 400 loafs of bread. It cost them $4,000 to buy an oven, $2,000 for flour and salt at this level of production, $800 to buy a computer for administrative work, and $40,000 to lease a building for the bakery for a year. What is this bakery's average variable cost?

Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter12: The Cost Of Production
Section: Chapter Questions
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At Jody's bakery they are currently selling 400 loafs of bread. It cost them $4,000 to buy an oven, $2,000 for flour and salt at this
level of production, $800 to buy a computer for administrative work, and $40,000 to lease a building for the bakery for a year. What
is this bakery's average variable cost?
Transcribed Image Text:At Jody's bakery they are currently selling 400 loafs of bread. It cost them $4,000 to buy an oven, $2,000 for flour and salt at this level of production, $800 to buy a computer for administrative work, and $40,000 to lease a building for the bakery for a year. What is this bakery's average variable cost?
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