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ID: 1223994 • Letter: #

Question

- Can someone help me with some of these questions, so I can understand them.

Use the above table and assume a fixed cost of $200.At an output of 4, ATC is $200. $225. $250. $400. Use the above table and assume a fixed cost of $1000.At an output of 4, ATC is $250. $400. $600. $800. Use the above table and assume a fixed cost of $200.At an output of 4, AFC is $50. $100. $200. $400. Use the above table and assume a fixed cost of $200At an output of 3, AVC is $133. $167. $200. Use the above table and assume a fixed cost of S1000At an output of 3, AVC is $250. $300. $333. $400. Use the above table and assume a fixed cost of $1000At an output of 1, marginal cost is 0. $200. $300. $400. Using the above graph, the AFC curve is J. K. L. M.

Explanation / Answer

1.

Table

Output (O)

Variable cost (V)

Fixed cost (F)

Total cost (TC) = V + F

AVC = V / O

ATC = TC / O

Marginal cost = difference in TC

1

200

200

400

200

400

400

2

300

200

500

150

250

100

3

500

200

700

166.67

233.33

200

4

800

200

1,000

200

250

300

At an output 4, an ATC is $250 as per the above table.

Answer: $250

Output (O)

Variable cost (V)

Fixed cost (F)

Total cost (TC) = V + F

AVC = V / O

ATC = TC / O

Marginal cost = difference in TC

1

200

200

400

200

400

400

2

300

200

500

150

250

100

3

500

200

700

166.67

233.33

200

4

800

200

1,000

200

250

300