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QUESTION 6 A firm that produces and sells toys has a factory located in New Town built on a 50,000 square feet plot of land.

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Answer #1

Answer

Variable cost =wages +cost of raw material +cost of packaging

=4000+3000+400

=7400

Average variable cost =variable cost /quantity

=7400/1000

=7.4

Option 2

$7.4

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