The manager of Greene Enterprises,Inc.,recently estimated its average variable cost AVC)function to be Greene Enterprises faces total fixed costs TFC)of $300,000.When Greene's output is 2,000 units,what is average variable cost AVC)?
A)$20
B)$48
C)$62
D)$72
E)$85

Question

The manager of Greene Enterprises,Inc.,recently estimated its average variable cost AVC)function to be  Greene Enterprises faces total fixed costs TFC)of $300,000.When Greene's output is 2,000 units,what is average variable cost AVC)?
A)$20 
B)$48 
C)$62 
D)$72 
E)$85

Quizplus · Accepted Answer

We are given that the AVC function is AVC = 11Q^(-0.5). When output is 2,000 units, we can plug this value into the AVC function to find AVC:
AVC = 11(2,000)^(-0.5) = $48. Therefore, the answer is (B).

The Manager of Greene Enterprises,Inc