Question

Microeconomics

Posted 6 months ago

```
The table below contains costs incurred by Fantabulous Enterprises, Inc., but some values are missing.
\begin{tabular}{lllll}
Quantity & Variable costs & Total Costs & Marginal costs & Average total costs \\
\hline 0 & & $\$ 100$ & & \\
1 & & $\$ 279$ & $\$ 179$ & $\$ 279$ \\
2 & $\$ 320$ & $\$ 420$ & $\$ 141$ & $\$ 210$ \\
3 & $\$ 447$ & $\$ 547$ & $\$ 127$ & $\$ 182$ \\
4 & $\$ 592$ & & $\$ 137$ & $\$ 173$ \\
5 & $\$ 755$ & $\$ 855$ & & $\$ 171$ \\
6 & & $\$ 1084$ & $\$ 229$ & $\$ 180$ \\
7 & $\$ 1295$ & $\$ 1395$ & $\$ 311$ & $\$ 200$
\end{tabular}
What is the total cost of producing 4 units?
Choose 1 answer:
(A) $\$ 540.00$
(B) $\$ 43.25$
(C) $\$ 592.00$
(D) $\$ 692.00$
(E) $\$ 229.00$
```

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Answer from Sia

Posted 6 months ago

Solution

a

Total Cost Calculation: The total cost (TC) is the sum of fixed costs (FC) and variable costs (VC). From the table, we know the fixed cost (FC) is $100 (since TC at quantity 0 is$100). For 4 units, the variable cost (VC) is $592. Therefore,$TC = FC + VC = 100 + 592 = 692$

Answer

(D) $692.00

Key Concept

Total Cost (TC)

Explanation

The total cost of producing a certain quantity of goods is the sum of fixed costs and variable costs. In this case, the fixed cost is $100, and the variable cost for 4 units is$592, leading to a total cost of $692.

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