If total cost at Quantity = 0 is $100 and total cost at Quantity = 10 is $500, then average variable cost at Quantity = 10 is _____.
A)$500
B)$400
C)$50
D)$40
E)$10

Question

If total cost at Quantity = 0 is $100 and total cost at Quantity = 10 is $500, then average variable cost at Quantity = 10 is _____.​
A)$500
B)$400​
C)$50​
D)$40​
E)$10​

Quizplus · Accepted Answer

We can calculate the total variable cost (TVC) by subtracting the fixed cost ($100) from the total cost at Quantity = 10 ($500):
TVC = $500 - $100 = $400

The average variable cost (AVC) is calculated by dividing the TVC by the quantity (Q):
AVC = TVC / Q = $400 / 10 = $40

Therefore, the correct answer is D) $40.

If Total Cost at Quantity = 0 Is $100 and Total