At 1,000 units of output, total cost is $42,000 and total variable cost is $34,000. At 1,000 units of output, what is the value of average total cost, average variable cost, and average fixed cost, respectively?
A)$22; $14; $8
B)$42; $34; $8
C)$4.20; $3.40; $0.80
D)$340; $740; $60
E)$42; $34; There is not enough information provided to determine the average fixed cost.

Question

Quizplus · Accepted Answer

Average total cost (ATC) = Total cost / Quantity = $42,000 / 1,000 = $42. Average variable cost (AVC) = Total variable cost / Quantity = $34,000 / 1,000 = $34. Average fixed cost (AFC) = (Total cost - Total variable cost) / Quantity = ($42,000 - $34,000) / 1,000 = $8.

At 1,000 Units of Output, Total Cost Is $42,000 and Total