Economics 2281 · O Level · Firms' costs, revenue and objectives

Firms' costs, revenue and objectives — practice question

A business making bicycles has these costs at different output levels. Output 10: total fixed costs $300$, total variable costs $800$. Output 20: total fixed costs $300$, total variable costs $1500$. Output 30: total fixed costs $300$, total variable costs $3300$. What happens to the average total cost over this range of output?

  • AIt falls continuously.
  • BIt falls then rises.
  • CIt rises continuously.
  • DIt rises then falls.

Worked solution & mark scheme

This 1-mark question has a full step-by-step worked solution and mark scheme.

  • Full mark scheme, point by point
  • Step-by-step worked solution
  • Write your answer & get it marked instantly by AI