The company's average cost per unit formula is given by:

$\text{Average Cost} = \frac{\text{Total Cost}}{x}$

where $x$ is the number of units produced.

In this case, the average cost function is already provided as:

$\text{Average Cost} = \frac{5000}{x} + 75 + 0.8x$

This function gives the average cost of producing $x$ units, where:

• $\frac{5000}{x}$ represents the fixed costs distributed over $x$ units,
• $75$ is a constant cost per unit,
• $0.8x$ is the variable cost that increases with each additional unit produced.

Further Questions:

1. What is the total cost function based on the given average cost function?
2. How does the average cost change as $x$ increases?
3. What is the minimum average cost and at what production level does it occur?
4. How would the average cost function change if the fixed cost was increased to $6000$?
5. How does the variable cost $0.8x$ affect the overall cost as production scales?

Tip: The total cost function can be derived by multiplying the average cost by $x$, giving insight into the cost behavior as production changes.