A firm is producing 100 units of output at a total cost of $400. The firm's average variable cost is $3.50 per unit. What is the firm's total fixed cost?
A) $350
B) $50
C) $40
D) $35

Question

Quizplus · Accepted Answer

The total variable cost (TVC) is calculated as average variable cost (AVC) times quantity, which is $3.50 * 100 = $350. The total cost (TC) is $400. Total fixed cost (TFC) is found by subtracting total variable cost from total cost: $400 - $350 = $50.

A Firm Is Producing 100 Units of Output at a Total