Question

A cutlery manufacturer producer produces 200 units of output at a total cost of $1,500. if total variable costs are $500, the average variable cost (per unit) is ______. $2.5 $3.00 $2.00 $1.00 $7.50

Answer 1

Since there are 200 units and variable costs are $500, we do a simple division, like this:

500/200 = 2.5.

So the answer is: 2.5

Hope this helped! c:

Answer 2

Given that production cost of 200 units is $1500 with a variable cost of $500, then the average variable cost per unit will be:
(variable cost)/(number of units)
=500/200
=$2.5 dollars per unit

Answer: A] $2.5