Question

You estimate that the average variable cost (AVC) will be $100 for the mower and $1,000 for the tractor. The total fixed cost (TFC) will be $50,000 for the mower and $100,000 for the tractor. What is the total cost of the mowers for each order?

Answer 1

Answer:

$50,100

Step-by-step explanation:

The total fixed cost(TFC) for the mower = $50000

The total fixed cost(TFC) for the tractor = $100000

The average variable cost(AVC) for the mower = $100

The average variable cost(AVC) for the tractor = $1000

So the total cost of the mower = Total Fixed Cost + Average Variable Cost

= 50000 + 100 = 50100

The total cost of the mowers for each order is $50,100.

Similarly, the total cost of the tractors for each order is $101,000.