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Calvin is a college student who has identified the need his fellow students have for transportation to and from a nearby store. He owns a van that can carry four people in addition to himself; he pays $50 insurance costs per month. He has calculated that his cost of transporting his fellow students will be $2.50 per student per round-trip ride, assuming he has a full van. Given this information, which statement is correct, assuming Calvin has a full van?

User Osaxma
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Answer:

Calvin's marginal cost is constant at $2.50; Calvin's average variable cost is constant at $2.50.

User Frank Wisniewski
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