A firm produces children's bicycles in the short run using two inputs, capital and labor. The quantity of capital is fixed and generates a monthly cost of $6,000. The quantity of labor can be varied, and the wage rate per hour of labor is $20. If 400 hours of labor are hired for the month, and 140 bicycles units of output are produced, what is the firm's average total cost for the month

Average total cost per unit = $100

Explanation:

The average total cost is the the total cost divided y the number of units

Average cost = (Total variable cost + Total fixed cost)/ Number of units

Total variable cost = (20× 400)=  8000

Total fixed cost = 6,000

Average total  cost = ( 8000 + 6000)/140 = $100

Average total cost per unit = $100

riley- $3

sean- $4

jake- $8

riley has the absolute advantage.