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At an output of 10,000 units per year, a firm's total variable costs are $50,000 and its average fixed costs are $2. The total costs per year for the firm are.
This cost per unit is the variable cost of each variable unit produced, or in other words the additional cost incurred for the production of each spark plug. For example, if the business produced 1,000 more units, it would expect to incur additional production costs of $180.his cost per unit is the variable cost of each variable unit produced, or in other words the additional cost incurred for the production of each spark plug. For example, if the business produced 1,000 more units, it would expect to incur additional production costs of $180.