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The average total cost of producing electronic calculators in a factory is $24 at the current output level of 230 units per week. If fixed cost is $505 per week, then what is the firm's variable cost? (enter answer as just a number, no commas, dollar signs, or the like)

Respuesta :

Answer:

Variable cost is $5015

Explanation:

Given:

Average total cost = $24

Output level for the week = 230 units

Fixed cost per week = $505

Average total cost = Total cost ÷ output level

Total cost = Average total cost × output level

               = 24 × 230

               = $5520

Now,

Total cost = Fixed cost + variable cost

Variable cost = Total cost - fixed cost

                     = 5520 - 505

                     = $5015

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