Refer to Exhibit 21-3. What level of output exhibits the lowest average total cost?

Variable Input	Fixed Input	Output	Marginal Physical Product of Variable Input	Total Fixed Cost	Total Variable Cost	Marginal Cost
(units)	(units)	(units)	(units)	(dollars)	(dollars)	(dollars)
0	1	0		$500	$0
1	1	10	(A)	$500	$200	(F)
2	1	25	(B)	$500	$400	(G)
3	1	45	(C)	$500	$600	(H)
4	1	60	(D)	$500	$800	(I)
5	1	70	(E)	$500	$1000	(J)

a.45 units

b.25 units

c.10 units

d.70 units

e.60 units

Solutions

Expert Solution

Rahul Sunny answered 1 year ago

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