Suppose a pizza parlor has the following production costs: $3.00 in labor per pizza, $1.oo in ingredients per pizza, $0.20 in electricity per pizza, $2000 in restaurant rent per month, and $450 in insurance per month.
Assume the pizza parlor produces 5,000 pizzas per month.
What is the variable cost of production(per month)?
What is the fixed cost of production(per month)?