In a small scale business, the fixed cost is N5,000, variable cost is N15,000 and the output is 500 units. What will be the unit cost of the goods?
- N400.00
- N80.00
-
N40.00
- N20.00
The correct answer is: C
Explanation
The unit cost of production is gotten by dividing the total cost by the output.
Hence we have;
\(\frac{15,000 + 5,000}{500}\) = \(\frac{20,000}{500}\) = 40