Multiple choice

The total cost at zero level of production is Rs. 8,000. The cost of producing 100 units is Rs. 12,000. Find the average fixed cost of 100 units.

  1. Rs. 120

  2. Rs. 40

  3. Rs. 80

  4. Rs. 160
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The fixed cost in the question is Rs. 8000 i.e. total cost at zero level. Thus, AFC= 8000/100 Rs. 120 is AC of 100 units and Rs. 40 is AVC.

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