A small firm rents a factory building for $4,000
due at the end of every month. Utilities for the building total $500
and are also paid monthly. The cost of labor is $10
for every unit produced. If 100 units are produced in one month, what are the total variable costs for the month?(1 point)
Responses
$4,510
4,510 dollars
$5,500
5,500 dollars
$1,000
1,000 dollars
$4,500
The total variable costs for the month would be $4,500.
Calculation:
Cost of labor per unit = $10
Number of units produced = 100
Total labor cost = $10/unit * 100 units = $1,000
Total variable costs = Total labor cost + Utilities cost
Total variable costs = $1,000 + $500 = $1,500
Therefore, the total variable costs for the month would be $4,500.