The cost structure of a manufacturer of microchips is described in the table in the next column. The firm’s fixed costs equal to \$10 per day. Calculate the average variable cost, average fixed cost, and average total cost at each output level. Output (microchips per day)Total Cost of Output (\$ thousands)0102560509575150100220125325150465

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The cost structure of a manufacturer of microchips is described in the table in the next column. The firm’s fixed costs equal to \$10 per day. Calculate the average variable cost, average fixed cost, and average total cost at each output level.

 Output (microchips per day) Total Cost of Output (\$ thousands) 0 10 25 60 50 95 75 150 100 220 125 325 150 465

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Step 1

Average total cost:

Average total cost can be calculated by using the following formula:

Step 2

Average fixed cost:

Average fixed cost can be calculated by using the following formula:

Step 3

Average variable cost:

Average variable cost can be calcula...

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