Use the following to answer questions:
-(Table: Workers and Output) Look at the table Workers and Output. After graduation you achieve your dream of opening an art shop that specializes in selling mud statues. You pay $10 per day on a loan from your uncle, and regardless of how much you produce, you pay $10 per day to each of the workers who make the mud statues. The variable cost of producing 48 statues is:
A) $50.
B) $48.
C) $20.
D) $10.

Question

Use the following to answer questions: 
-(Table: Workers and Output) Look at the table Workers and Output. After graduation you achieve your dream of opening an art shop that specializes in selling mud statues. You pay $10 per day on a loan from your uncle, and regardless of how much you produce, you pay $10 per day to each of the workers who make the mud statues. The variable cost of producing 48 statues is:
A) $50. 
B) $48. 
C) $20. 
D) $10.

Quizplus · Accepted Answer

The variable cost is the cost that changes with the level of output. Here, it is the cost of paying workers. If 48 statues are produced, and assuming each worker is paid $10 per day, the variable cost is the total amount paid to the workers. If 5 workers are needed to produce 48 statues, the variable cost would be 5 workers x $10 = $50.

Use the Following to Answer Questions