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WAEC Economics 2024 Question 20

Question 20

Theory of Costs and Revenue

The fixed cost of producing 100 units of a good is $600. If the variable cost is $400, the average total cost of one unit of the good is

  1. A.$4.
  2. B.$6.
  3. C.$8.
  4. D.$10.
Show the answer and explanation

Answer: D ($10.)

Explanation

ATC = (600 + 400) ÷ 100 = $10.