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A foundry has a fixed daily cost of Rs 50,000 whenever it operates and a variable cost of Rs 8000, where Q is the daily production in tonnes. What is the cost of production in Rs per tonne for a daily production of 100 tonnes?

1. 580
2. 5800
3. 58000
4. 580000

Correct answer: 580

Solution

To find the cost of production per tonne, first calculate the total cost by adding the fixed cost (Rs 50,000) to the variable cost (Rs 8,000 multiplied by 100 tonnes), which totals Rs 58,000. Dividing this total cost by the daily production of 100 tonnes gives a cost of Rs 580 per tonne.

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