For manufacturing a certain item, the fixed cost is ₹6000 and the cost of producing each unit is ₹20. What is the total cost and average cost of producing 15 units?

Total Cost = ₹6300, Average Cost = ₹420

The correct answer is Option (2) → Total Cost = ₹6300, Average Cost = ₹420

Total fixed cost = ₹6000,

variable cost of producing one unit = ₹20

∴ Total cost, $TC = ₹(6000+ 20x)$, where x is the number of units produced.

Total cost of producing 15 units = $\left.TC\right|_{x=15}$

$=₹(6000+ 20 × 15) = ₹6300$

∴ Average cost of producing 15 units = $₹\frac{6300}{15}=₹420$.