If the total cost of producing one unit of the output is $100 and the marginal cost of that unit is $20, the average fixed cost of producing two units of output is ________
Fill in the blank(s) with correct word
$40
Marginal cost = Variable cost ; As we are producing only 1 unit variable cost will be $20
Total Fixed Cost = Total Cost - Total Variable Cost
$100 - $20 = $80
Average Fixed Cost = 80/2 = $40
Economics
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