Tuesday, 25 October 2011

Investments: fixed and variable costs

Investments: fixed and variable costs?

In a slow year, a company will produce 2 million hamburgers at a total cost of $3.5 million. In a good year, it can produce 4 million hamburgers at a total cost of $4.5 million. What are the fixed and variable costs of hamburger production?
Ans:

Is there any further information? I don't think you could figure out fixed and variable costs just from this info. Variable costs are usually a % of sales and fixed costs remain the same no matter what...but it doesn't seem like there is enough info

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