Given the cost function C = 160 + 36Q, what is the average cost at 20 units of output?

Answer Details

To find the average cost at 20 units of output, we need to divide the total cost by the number of units produced. The total cost at 20 units of output can be found by substituting Q=20 into the given cost function C = 160 + 36Q: C = 160 + 36(20) = 160 + 720 = 880 So the total cost of producing 20 units of output is N880.00. To find the average cost, we divide the total cost by the number of units produced: Average cost = Total cost / Number of units produced = 880 / 20 = N44.00 Therefore, the average cost at 20 units of output is N44.00.