Copyright

Your cousin Vinnie owns a painting company with fixed costs of $150 and the following schedule...

Question:

Your cousin Vinnie owns a painting company with fixed costs of $150 and the following schedule for variable costs:

Quantity (Houses Painted per Month)Variable Cost(Dollars)Average Fixed Cost (Dollars)Average Variable Cost (Dollars)Average Total Cost(Dollars)
1 15
235
3 60
490
5135
6240
7480

The efficient scale is _____ houses.

Average Total Cost:

The average total cost refers to the value of the total cost divided by the number of units cost. According to accepted economic theory this cost changes as a function of the number of units produced. The most efficient and optimal level of production output is achieved when the producer produces at the volume that incurs the lowest average cost per unit. In other words where the average total cost level is at a minimum.

Answer and Explanation: 1

Become a Study.com member to unlock this answer!

View this answer

Quantity (Houses Painted per Month)Variable Cost(Dollars)Average Fixed Cost (Dollars)Average Variable Cost (Dollars)Average Total Cost(Dollars)
1 15 ...

See full answer below.


Learn more about this topic:

Loading...
Average Total Cost: Definition & Formula

from

Chapter 3 / Lesson 23
58K

Learn what is the average total cost. Learn its use, its formula, and how to apply it.


Related to this Question

Explore our homework questions and answers library