Asked by Miguel Angel on May 01, 2024
Verified
If AVC=$5 and AFC=15,then AC=
A) $10
B) $5
C) $15
D) $20
AVC
Average Variable Cost, which is the total variable costs (costs that change with production levels) divided by the quantity of output produced.
AFC
Average Fixed Cost; the fixed expenses of a company divided by the number of units produced.
AC
Typically refers to "air conditioning," a system for controlling the humidity, ventilation, and temperature in a building or vehicle.
- Master the techniques for computing average variable cost (AVC), average fixed cost (AFC), and average total cost (ATC), and appreciate their importance in the evaluation of production expenditures.
Verified Answer
ZK
Zybrea KnightMay 03, 2024
Final Answer :
D
Explanation :
AC (Average Cost) is the sum of AVC (Average Variable Cost) and AFC (Average Fixed Cost). Therefore, AC = AVC + AFC = $5 + $15 = $20.
Learning Objectives
- Master the techniques for computing average variable cost (AVC), average fixed cost (AFC), and average total cost (ATC), and appreciate their importance in the evaluation of production expenditures.