passwella.
Menu

JAMB Economics 1987 Question 8

Question 8

Theory of Costs and Revenue

Average Fixed Cost is

  1. A.Average Total Cost less the sum of Average Variable Cost
  2. B.half the sum of all costs
  3. C.Total Fixed Cost divided by the level of output
  4. D.Total Fixed Cost plus Marginal Cost.
Show the answer and explanation

Answer: C (Total Fixed Cost divided by the level of output)

Explanation

Average fixed cost is fixed cost per unit: total fixed cost ÷ output.