Suppose the firm faces a price of $49, an average variable cost of $26, and has an average fixed cost of $5. In the short-

Question

4 years ago

10

Suppose the firm faces a price of $49, an average variable cost of $26, and has an average fixed cost of $5. In the short-

run, this firm
A. can cover all its costs,
B. cannot cover all its costs,
A. and will have a loss per unit of $18.
B. and will have a profit per unit of $23.
C. and will have a profit per unit of $18 .
D. and will have a loss per unit of $23.

Business

1 answer:

pychu [463] · Answer 1 · 2021-11-12T09:43:57+03:00

Answer:

A) can cover all its costs, ⇒ C) and will have a profit per unit of $18.

Explanation:

The company sells its products at $49 per unit, and each unit's total cost is $31 (= $26 variable costs + $5 fixed costs), therefore the company is covering all its costs and making an $18 profit (= $49 - $31) for each unit is sells.

Suppose the firm faces a price of ​$49​, an average variable cost of ​$26​, and has an average fixed cost of ​$5. In the​ short-

Suppose the firm faces a price of $49, an average variable cost of $26, and has an average fixed cost of $5. In the short-