If average total cost is $0.75 when output is 100 units and total fixed cost is $10,average variable cost is
A) $0.65.
B) $9.25.
C) $10.75.
D) $65.
E) $75.

Question

Quizplus · Accepted Answer

To find the average variable cost, we need to subtract the total fixed cost from the average total cost and divide the result by the output. 
AVC = (ATC - TFC) / Q
AVC = ($0.75 - $10) / 100
AVC = $0.65. 
Therefore, the answer is A, $0.65.

If Average Total Cost Is $0