At its current short-run level of production, a firm's average variable costs equal $20 per unit, and its average fixed costs equal $30 per unit. Its total costs at this production level equal $2,500. A. What is the firm's current output level? B. What are its total variable costs at this output level? C. What are its total fixed costs?

Answer and Explanation:

The computation is shown below

Total average cost + total variable cost = total cost

Let number of output be x

So,

Total fixed average cost = x * $30

Total variable cost = x * $15

Total cost = $2,500

Therefore,

$20 * x + $30 * x = $2,500

50 * x = $2,500

x = 50

Now the total variable cost is

= 50 * $20

= $1,000

And, the fixed cost is

= 50 * $30

= $1,500

12 4

Explanation:

because the production average is variable