Business I / Production and Costs
Practice question · Estimate

A firm has FC=500FC = 500 and produces 50 units. Estimate AFC.

Estimate on a scale from 0 to 20.

Hints
  1. Divide the fixed cost by the number of units.
  2. The arithmetic is a single clean division.
Show the answer

10 (answers within ±1 count)

Why

AFC=500/50=10AFC = 500/50 = 10. Simple division, fixed costs spread over 50 units.

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