Recall that at any given level of output, variable costs = Q x AVC. In this case output is 10 and AVC = 15 at 10 units of output, so the firms variable costs are 10 x 15 = 150. This is shown above as the shaded area.
11. Consider the profit maximizing perfectly competitive firm shown in Figure 3 If this firm is producing an output of 10 units, it's total variable costs will be:

1. $150.
2. $20. At an output of 10, this is the average cost per unit.
3. $15. At an output of 10, this is the variable cost per unit.
4. $50. This is the fixed cost for this firm.
5. $200. At an output of 10, this is the total cost.

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