Question

Answer the next question on the basis of the following data. Output Total Cost 0 $24 1 33 2 41 3 48 4 54 5 61 6 69 The average fixed cost of producing 3 units of output is rev: 06_26_2018
A. $8.00.
B. $7.40.
C. $6.00.
D. $5.50.

Answer 1

Answer:

Option (A) is correct.

Explanation:

The average fixed cost is determined by dividing the total fixed cost by number of units produced.

Given that,

Fixed cost = $24

The average fixed cost of producing 3 units of output is:

= Total Fixed cost ÷  Number of units produced

= $24 ÷  3

= 8

Therefore, the average fixed cost of producing 3 units of output is $8.00.