A regional microbrewery analyzed its production costs at different weekly output levels of craft beer casks. The table below outlines its average variable costs and average total costs:
| Output (casks) | Average variable costs (£) | Average total costs (£) |
|---|---|---|
| 50 | 120 | 210 |
| 100 | 105 | 150 |
| 150 | 95 | 125 |
When the microbrewery increases its weekly output from
50 to 100 casks, average fixed costs fall by £15.
50 to 100 casks, average fixed costs fall by £45.
100 to 150 casks, average fixed costs fall by £25.
100 to 150 casks, average fixed costs fall by £10.
156 exam-style questions on AQA A Level Economics 1.4 Production, costs and revenue, covering 1.4.1 Production and productivity, 1.4.2 Specialisation, division of labour and exchange, 1.4.3 The law of diminishing returns and returns to scale (A-level only), 1.4.4 Costs of production, 1.4.5 Economies and diseconomies of scale, 1.4.6 Marginal, average and total revenue, 1.4.7 Profit, and 1.4.8 Technological change (A-level only). Each one has a worked solution and a mark scheme showing where the marks go.