Question

You are given that the total cost of producing 10 units of output is $100 and...

You are given that the total cost of producing 10 units of output is $100 and the fixed costs are $20. Calculate TVC, ATC, AFC, and AVC. Show your calculations.

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Homework Answers

Answer #1

TC = TFC + TVC
TVC = 100 - 20
TVC = 80

AC = TC / Q
Ac = 100/10
AC = 10

AVC = TVC / Q
AVC = 80 / 10
AVC = 8

AFC = TFC / Q
AFC = 20/10
AFC = 2

Also, AC = AFC + AVC
AC = 2 +8
AC = 10

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