Question

Q3: Complete the following table. Hint: Start with the first row.

Q (units)	TFC ($)	TVC ($)	TC ($)	AFC ($/unit)	AVC ($/unit)	ATC ($/unit)	MC ($/unit)
0			$1,800	–	–	–	–
1					$600
2							$400
3						$1,200
4		$2,800

Answer 1

Here,

The table is completed as below,

For quantity 0,

TFC = TC = $1800

Now fixed cost is constant

For quantity 1 ,

Average Valuable cost = total variable cost = $600

So,

TFC= $1800, TVC = $600, TC = $2400, AFC = $1800, AVC = $600, ATC = $2400

For quantity 3,

ATC = $1200, So total Cost = 3*1200 =$3600

Fixed Cost = $1800, So TVC = $3600 - $1800 = $1800

AVC = $1800/3 = $600

For Quantity 4,

TVC = $2800

AVC = $700

TFC = $1800, TC= $1800 + $2800 = $4600

So completing the table we have,

Quantity	TFC	TVC	TC	AFC	AVC	ATC
0	$1800	-	$1800	-	-	-
1	$1800	$600	$2400	$1800	$600	$2400
2	$1800	$1200	$3000	$900	$600	$1500
3	$1800	$1800	$3600	$600	$600	$1200
4	$1800	$2800	$4600	$450	$700	$1150