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JAMB Economics 1991 Question 7

Question 7

Theory of Costs and Revenue

At any given level of output, the total cost of a firm equals the

  1. A.marginal cost plus the average cost
  2. B.fixed costs less its variable cost
  3. C.average cost multiplied by its output
  4. D.economic costs multiplied by variable costs
Show the answer and explanation

Answer: C (average cost multiplied by its output)

Explanation

Average cost = total cost ÷ output, so total cost = average cost × output.