56. If total fixed cost is $200, total variable cost is $600, and total product is 4 units, then average total cost must be

A. $200.
B. $250.
C. $800.
D. $3,200.

Question

56.    If total fixed cost is $200, total variable cost is $600, and total product is 4 units, then average total cost must be

A.  $200.
B. $250.
C.  $800.
D. $3,200.

BlackTom AI · Accepted Answer

Average total cost (ATC) equals total cost per unit of output: ATC = Total Cost / Quantity. Total cost (TC) is the sum of total fixed cost (TFC) and total variable cost (TVC): TC = TFC + TVC.

1) Relevant knowledge points and concepts
- Total fixed cost (TFC) does not change with output.
- Total variable cost (TVC) varies with output.
- Total cost (TC) = TFC + TVC.
- Average total cost (ATC) = TC / Q.
- Also useful: Average fixed cost (AFC) = TFC / Q and Average variable cost (AVC) = TVC / Q, with ATC = AFC + AVC.

2) Step-by-step reasoning and calculation
Given: TFC = $200, TVC = $600, Quantity (Q) = 4 units.
Step 1: Compute total cost:
TC = TFC + TVC = $200 + $600 = $800.
Step 2: Compute ATC using TC and Q:
ATC = TC / Q = $800 / 4.

3) Intermediate arithmetic shown
$800 ÷ 4 = $200.

4) Why the correct answer is correct
ATC measures the cost per unit produced. With total cost $800 and 4 units produced, each unit carries $800/4 = $200 in total costs. Alternatively, compute AFC = $200/4 = $50 and AVC = $600/4 = $150, then ATC = AFC + AVC = $50 + $150 = $200, confirming the result.

5) Why the other options are incorrect
- B ($250): Would imply TC = $250 × 4 = $1,000, but actual TC is $800, so incorrect.
- C ($800): This equals total cost, not average cost per unit. ATC is TC divided by quantity, so C confuses total with average.
- D ($3,200): Far larger than any relevant calculation here (would correspond to $800 × 4 or $3,200 total cost for 4 units, which does not match given data).

6) Conclusion
Therefore the average total cost is $200 per unit, matching the provided correct answer A.

56. If total fixed cost is $200, total variable cost is $600, and total product is 4 units, then average total cost must be A. $200. B. $250. C. $800. D. $3,200.Single choice

Similar Questions

According to Table 1 below, what is the average total cost when output per day is 21?

Table 5.6 Quantity Total Cost 0 $90 1 $115 2 $122 3 $132 4 $154 5 $185 Refer to Table 5.6. What is the average total cost of producing two units?

Which of the following best explains why the short- run average total cost curve is U-shaped?

Name the Supreme Court decision that removed financial constraints on PACs.

Political scientists Joshua Kalla and David Broockman find that senior policy makers made themselves available to _____ between three and four times more often than they did to constituents.

Name the political scientist who argues that parties are designed to serve the needs of ambitious politicians (namely candidates and officeholders).

Name the political scientist who said this famous quote about the problems of pluralism: “The flaw in the pluralist heaven is that the heavenly choir sings with a strong upper-class accent.”

What is the name of the third party candidate in 2000 who was not allowed to participate in the presidential debates? Hint: We watched a video clip with him in class.

More Practical Tools for Students Powered by AI Study Helper

Homework AI Solver

Stylized AI Paper Writer

Plagiarism Checker Assistant

Citation AI Academic Writing Tool

In-Class Translation Assistant

AI Note Generator

AI Quiz Answers

Past Exam Questions from University Test Bank

Smart Practice Assistant

Adaptive Practice

Making Your Study Simpler