Assume a firm is currently producing 100 units of output,total fixed costs are $10,000,and average variable costs are $8.Based on this information we can conclude,with certainty,that the firm's:
A)marginal costs are $8.
B)total variable costs are $8000.
C)average fixed costs are $2.
D)total costs are $10,800.

Question

Quizplus · Accepted Answer

Total costs can be calculated as follows:
Total Costs = Total Fixed Costs + Total Variable Costs
Total Variable Costs = Average Variable Cost x Units of Output
Given that the firm is currently producing 100 units of output, we can calculate the total variable costs as:
Total Variable Costs = $8 x 100 = $800
Therefore, Total Costs = $10,000 + $800 = $10,800. 
Hence, option (D) is the correct answer.

Assume a Firm Is Currently Producing 100 Units of Output,total