Question

A firm has a fixed cost of $200 in its first year of operation. When the firm produces 99 units of output, its total costs are $4,000. The marginal cost of producing the 100th unit of output is $700. What is the total cost of producing 100 units

Answer 1

Answer:

total cost of producing 100 units is $4700

Explanation:

given,

Fixed cost  =  $200

Total cost   =  $4,000

The total cost of n units = total cost of (n-1) units +marginal cost  of nth unit

The total cost of 100 units= total cost of 99 units+marginal cost  of 100th unit

The total cost of 100 units = $4000 + $700

                                         =4000+700

                                         =$4700

the total cost of producing 100 units is $4700