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Using the data in the table below, plot the total fixed costs (TFC), total variable costs (TVC) and total cost (TC) schedules.

Quantity	TFC ($)	TVC ($)	TC ($)
0	120	0	120
1	120	60	180
2	120	80	200
3	120	90	210
4	120	105	225
5	120	140	260
6	120	210	330

Answer 1

Quantity	TFC	TVC	TC
0	120	0	120
1	120	60	180
2	120	80	200
3	120	90	210
4	120	105	225
5	120	140	260
6	120	210	330

TC=TFC+TVC

TFC is independent of output. TFC does not vary with output. Fixed cost is incurred each the level of output is zero. therefore TFC starts from vertical intercept and it is parallel is x-axis.

TVC is varies with level of output. It is inverse S shaped. Initially TVC increases at an decreasing rate with the increase in output. Then TVC increases in an increasing rate with the increase in output. When output is zero variable cost is also zero. There fore TVC curve starts from zero interceptt.

TC is the summation of tvc and tfc. As TFC is parallel to X axis, TC is parallel to TVC and it start from TFC