Consider the following figures which refer to a firm’s production department during one week:
Wage bill ₦6,000, Rent, Rates, Depreciation ₦200, raw materials ₦800, Power ₦300.
Total variable costs incurred during the week are
- ₦7,300
-
₦7,100
- ₦1,300
- ₦1,100
The correct answer is: B
Explanation
Total variable costs also known as variable cost. TVC is the cost that varies or changes with the level of output.
TVC = 6000 + 800 + 300
TVC = ₦7100