Economics20785 marksNumerical: cost schedule calculationsCost schedule computations
Cost Schedule Calculations Calculate TC, AFC, AVC, AC, and MC under the total fixed cost 100, from the following cost schedule. | Output | TVC | TC | AFC | AVC | AC | MC | |--------|-----|-----|------|------|------|------| | 0 | 0 | 100 | - | - | - | - | | 1 | 10 | 110 | 100 | 10 | 110 | 10 | | 2 |
Cost Schedule Calculations
Calculate TC, AFC, AVC, AC, and MC under the total fixed cost 100, from the following cost schedule.
| Output | TVC | TC | AFC | AVC | AC | MC |
|---|---|---|---|---|---|---|
| 0 | 0 | 100 | - | - | - | - |
| 1 | 10 | 110 | 100 | 10 | 110 | 10 |
| 2 | 18 | 118 | 50 | 9 | 59 | 8 |
| 3 | 24 | 124 | 33.33 | 8 | 41.33 | 6 |
| 4 | 32 | 132 | 25 | 8 | 33 | 8 |
| 5 | 50 | 150 | 20 | 10 | 30 | 18 |
| 6 | 80 | 180 | 16.67 | 13.33 | 30 | 30 |
| 7 | 124 | 224 | 14.29 | 17.71 | 32 | 44 |
| 8 | 180 | 280 | 12.5 | 22.5 | 35 | 56 |
| 9 | 260 | 360 | 11.11 | 28.89 | 40 | 80 |
Where:
- $TC = \text{TFC} + \text{TVC} = 100 + \text{TVC}$
- $AFC = \frac{\text{TFC}}{\text{Output}}$
- $AVC = \frac{\text{TVC}}{\text{Output}}$
- $AC = \frac{\text{TC}}{\text{Output}}$
- $MC = \frac{\Delta \text{TC}}{\Delta \text{Output}}$
[5]
- TFC = 100 - Output (Q): 0, 1, 2, 3, 4, 5, 6, 7, 8, 9 - TVC: 0, 10, 18, 24, 32, 50, 80, 124, 180, 260 - $TC = TFC + TVC$ - $AFC = TFC / Q$ - $AVC = TVC / Q$ - $AC = TC / Q$ - $MC = \Delta TC / \Delta Q$ TC = TFC + TVC: - Q=0: 100+0 = 100 - Q=1: 100+10 = 110 - Q=2: 100+18 = 118 - Q=3: 100+24 = 12...