-Figure 7-7 shows a firm's total variable cost for different daily output levels.In addition,the firm has total fixed cost of $50 per day.If output increases from 20 to 30 units,average total cost rises from
A)$17.50 to $19.17,and marginal cost is $225.00
B)$400 to $625,and marginal cost is $225.00
C)$15.00 to $22.50,and marginal cost is $22.50
D)$20.00 to $20.83,and marginal cost is $22.50
E)$20.00 to $20.83,and marginal cost is $225.00

Question

-Figure 7-7 shows a firm's total variable cost for different daily output levels.In addition,the firm has total fixed cost of $50 per day.If output increases from 20 to 30 units,average total cost rises from
A)$17.50 to $19.17,and marginal cost is $225.00 
B)$400 to $625,and marginal cost is $225.00 
C)$15.00 to $22.50,and marginal cost is $22.50 
D)$20.00 to $20.83,and marginal cost is $22.50 
E)$20.00 to $20.83,and marginal cost is $225.00

Quizplus · Accepted Answer

Average total cost is calculated by dividing the total cost (fixed cost + variable cost) by the quantity of output. The marginal cost is the change in total cost when output is increased by one unit. The correct choice reflects these calculations accurately.

-Figure 7-7 Shows a Firm's Total Variable Cost for Different