Economics · Oct / Nov 2019 · Paper 13 · Question 15

A firm producing bicycles has the following costs at different levels of output. | output | total fixed costs ($) | total variable costs ($) | |---|---|---| | 10 | 300 | 800 | | 20 | 300 | 1500 | | 30 | 300 | 3300 | What happens to the average total cost over this range of output?

1. AIt falls continuously.
2. BIt falls then rises.
3. CIt rises continuously.
4. DIt rises then falls.

As printed in the paper