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Homework answers / question archive / The per-unit cost of an item is its average total cost ("total cost quantity)
The per-unit cost of an item is its average total cost ("total cost quantity). Suppose that a new cell phone application costs $200,000 to develop and only $0.50 per unit to deliver to each cell phone Instructions: Round your answers to 2 decimal places.
a. What will be the per-unit cost of the application sells 100 units? $
b. What will be the per-unit cost of the application if it sells 1,000 units? $
c. What will be the per-unit cost of the application if it sells 1 million units? $
TC=200,000+0.5QAC=200,000/Q+0.5TC=200,000+0.5QAC=200,000/Q+0.5
a. AC=200,000/100+0.5=2000.5AC=200,000/100+0.5=2000.5
b. AC=200,000/1000+0.5=200.5AC=200,000/1000+0.5=200.5
c. AC=200,000/1000000+0.5=0.25