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26 January, 21:36

At its current short-run level of production, a firm's average variable costs equal $15 per unit, and its average fixed costs equal $10 per unit. Its total costs at this production level equal $500. What is the firm's current output level? nothing units.

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  1. 26 January, 21:52
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    20 units

    Explanation:

    Let;

    TC = Total cost = $500

    AVC = Average variable cost = $15

    AFC = Average fixed cost = $10

    Q = Quantity = ?

    (AVC + AFC) Q = TC

    Substituting the values and solve for Q, we have:

    ($15 + $10) Q = $500

    $25Q = $500

    Q = $500/$25

    Q = 20 units

    Therefore, the firm's current output level is 20 units.
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