n a slow year, Deutsche Burgers will produce 2.800 million hamburgers at a total cost of $4.200 million. In a good year, it can produce 5.300 million hamburgers at a total cost of $6.000 million.

a. What are the fixed costs of hamburger production? (Do not round intermediate calculations. Enter your answer in millions rounded to 1 decimal place.)

b. What is the variable cost per hamburger? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

c. What is the average cost per burger when the firm produces 2 million hamburgers? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

d. What is the average cost per burger when the firm produces 3 million hamburgers? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

e. Why is the average cost lower when more burgers are produced?

• The fixed costs are spread across more burgers.
• Variable costs are lower per burger.
• Fixed costs are constant per burger.