Suppose the total cost of producing 10,000 tennis balls is $30,000 and the fixed cost is $10,000.
a. What is the variable cost of producing 10,000 tennis balls?
b. When output is 10,000 balls, what is the average variable cost?
c. When output is 10,000 balls, what is the average fixed cost?
d. Assume that the cost curves have the usual shapes. Is the dollar difference between the average total cost and the average variable cost greater when the output is 10,000 tennis balls or 30,000 tennis balls? Briefly explain your answer.