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JAMB Economics 2014 Question 20

Question 20

Theory of Costs and Revenue

Given that FC = ₦500, VC = ₦1500, and Q = 50 units. Find the average cost of the product.

  1. A.₦10
  2. B.₦20
  3. C.₦30
  4. D.₦40.
Show the answer and explanation

Answer: D (₦40.)

Explanation

Total cost = 500 + 1500 = ₦2000. Average cost = 2000 ÷ 50 = ₦40.