Table 13-3
Consider the following firm which makes high-performance racing bicycles.All costs are given in dollars.Output is shown on a monthly basis.The firm's fixed costs include a rent of $800 and a lease cost of $400 per month.
-Refer to Table 13-3.What is the average variable cost for the month if six bicycles are produced?
A)$200
B)$265
C)$465
D)$1590

Question

Table 13-3
Consider the following firm which makes high-performance racing bicycles.All costs are given in dollars.Output is shown on a monthly basis.The firm's fixed costs include a rent of $800 and a lease cost of $400 per month. 
-Refer to Table 13-3.What is the average variable cost for the month if six bicycles are produced?
A)$200 
B)$265 
C)$465 
D)$1590

Quizplus · Accepted Answer

To calculate the average variable cost, we need to add up the total variable costs and divide by the total output. From the table, we can see that the total variable costs for six bicycles are $1590. Therefore, the average variable cost for the month if six bicycles are produced is: 
AVC = ($1590/6) = $265. Option B is the correct answer.

Table 13-3 Consider the Following Firm Which Makes High-Performance Racing Bicycles.All Costs