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Micro 3.2-Cost Terms-Video Choice and Cost Sort

Last updated 3 months ago
2 questions
Note from the author:
7 SR Cost Curves
1

Categorize the cost term with Totals and Q output.

  • =Q*ATC
  • =TC/ATC
  • Stands for Total Fixed Cost
  • Is related to things such as labor.
  • =All Costs at a given output.
  • =TFC/AFC
  • =TFC+TVC
  • Stands for Total Cost
  • =Q*AFC
  • =Sum of TFC and TVC
  • Is constant
  • Is a subcomponent of TC that increases as Q increases.
  • =TVC/AVC
  • Stands for Total Variable Cost
  • =All costs of these type DO NOT change.
  • =Q*AVC
  • TFC
  • TVC
  • TC
  • Qoutput
1

Categorize the Average Cost Terms and Marginal Cost

  • =TVC / Q
  • =TC/Q
  • =Sum of two average costs that first falls then rises.
  • =ATC-AVC
  • Is a subcomponent of ATC that first falls then rises.
  • =Δ TVC / Δ Q
  • Stands for Average Fixed Cost
  • =TFC / Q
  • =ATC-AFC
  • =Variable Cost PER UNIT OF OUTPUT
  • Stands for Average Total Cost
  • Stands for Marginal Cost
  • =AFC+AVC
  • ALWAYS falls as Q rises.
  • Stands for Average Variable Cost
  • =Change in the firm's TC when it produces another unit of output.
  • =Change in TVC from an extra unit of output.
  • =Total Cost PER UNIT OF OUTPUT.
  • =Δ TC / Δ Q
  • =Fixed Cost PER UNIT OF OUTPUT
  • AFC
  • AVC
  • ATC
  • MC