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Pepper's pizza produces 100 pizzas a day. Each pizza sells for $15, no matter how...

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Accounting

Pepper's pizza produces 100 pizzas a day. Each pizza sells for $15, no matter how many pizzas he sells. The building Pepper's has rented (according to a 7-month contract) costs $40 a day in rent. Pepper has also rented a pizza oven for $10 a day (and has signed a 3-month contract for the oven rental). Pepper spends $400 a day hiring workers and $800 a day on raw materials. These are all of Pepper's costs. Pepper can hire or fire workers and adjust raw material usage as needed and has just begun the contract on his rentals.
Based on the information above, what is Pepper's Average Variable Cost of producing?
$8
$2
$500
$5
$800
$8.25
$12
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