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According to Table 8.6 in the raspberry farm example, at what quantity is average variable cost at its minimum, and what is that minimum value?
AA quantity of 80, with average variable cost of $2.52
BA quantity of 100, with average variable cost of $3.42
CA quantity of 40, with average variable cost of $2.05
DA quantity of 30, with average variable cost of $2.13
Answer & Solution
Correct answer: C. A quantity of 40, with average variable cost of $2.05
1. Table 8.6 lists average variable cost at each output level for the raspberry farm.
2. The lowest value in that column is $2.05, occurring at a quantity of 40.
3. The source confirms this directly, calling $2.05 the minimum average variable cost and the shutdown threshold.
4. Values at 30 or 80 units are higher than $2.05, so neither is the true minimum.
_Source: OpenStax Principles of Microeconomics for AP Courses (CC BY 4.0), Ch 8 "Perfect Competition", section 8.2 | How Perfectly Competitive Firms Make Output Decisions_
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