Question

The following table shows the total sechedule of a firm. What is the total fixed cost schedule of the firm? Calculate the TVC, AFC, AVC, SAC (Short-run Average Cost or AC) and SMC (Short-run Marginal Cost or MC) schedules of the firm.

Answer 1

Formulae used : (i) `TVC = TC - TFC`, (ii) `SAC (AC) = TC ÷ "Output"`, (iii) `AVC = TVC ÷ "Output"`,
(iv) `SMC_(n) (MC_(n)) = TC_(n) - TC_(n-1)` , (V) `TFC = TC` at 0 level of output, (vi) `AFC = TFC ÷ "Output"`