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Question

The level of output and total cost of production of a product is given below:
Level of productionTotal cost of production
020000
100620,000
1509,20,000
18011,00,000
What is the per unit variable cost of production?


A
Rs. 6133
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B
Rs. 6000
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C
Rs. 20,000
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D
None
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Solution

The correct option is B Rs. 6000
Variable Cost = Total cost - Fixed cost
                        = 6,20,000 - 20,000
                        = 6,00,000

Unit variable costs =  TVC / Q
                                = 6,00,000/100
                                = 6000

Mathematics

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