Refer to the table below. Quantity Variable cost (in dollars) Fixed cost (in dol
ID: 1155665 • Letter: R
Question
Refer to the table below.
Quantity
Variable cost (in dollars)
Fixed cost (in dollars)
Total costs (in dollars)
Average variable costs (in dollars per unit)
Average Total costs (in dollars per unit)
Marginal costs (in dollars per unit)
0
0
40
40
1
15
40
55
15
55
15
2
35
40
75
17.5
37.5
20
3
60
40
100
20
33.3
25
4
90
40
130
22.5
32.5
30
5
125
40
165
25
33
35
6
160
40
200
26.6
33.3
35
If the firm produces 5 units that it sells at a price of $30.00 each, what will its profits or losses equal?
a-losses equal $15
b-losses equal $25
c-profits equal $25
d-profits equal $15
Quantity
Variable cost (in dollars)
Fixed cost (in dollars)
Total costs (in dollars)
Average variable costs (in dollars per unit)
Average Total costs (in dollars per unit)
Marginal costs (in dollars per unit)
0
0
40
40
1
15
40
55
15
55
15
2
35
40
75
17.5
37.5
20
3
60
40
100
20
33.3
25
4
90
40
130
22.5
32.5
30
5
125
40
165
25
33
35
6
160
40
200
26.6
33.3
35
Explanation / Answer
Profit= P*Q - Total cost
= 30*5 - 165
= 150 - 165
= -15
Losses equal 15 is correct
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