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Units Of Output

Marginal Cost Puzzle. Units Of Output. TFC. TVC. TC. MC. AFC. AVC. 0. 1. 10. 2. 46. 20. 20. 3. 4. 18. 5. 130. 4. Marginal Cost Puzzle. Units Of Output. TFC. TVC. TC. MC. AFC. AVC. 0. 20. 1. 20. 10. 2. 46. 20. 20. 20. 20. 3. 20. 4. 20. 18. 5. 20. 130.

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Units Of Output

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  1. Marginal Cost Puzzle Units Of Output TFC TVC TC MC AFC AVC 0 1 10 2 46 20 20 3 4 18 5 130 4

  2. Marginal Cost Puzzle Units Of Output TFC TVC TC MC AFC AVC 0 20 1 20 10 2 46 20 20 20 20 3 20 4 20 18 5 20 130 4 Step 1 : AFC * Q = TFC. TFC never changes. So 4 x 5 = 20 = TFC

  3. Marginal Cost Puzzle Units Of Output TFC TVC TC MC AFC AVC 0 20 1 20 10 10 2 46 20 20 20 20 3 20 4 20 72 18 5 20 130 4 Step 2: AVC x Q = TVC So, 18 x 4 = 72 and 10 x 1 = 10

  4. Marginal Cost Puzzle Units Of Output TFC TVC TC MC AFC AVC 0 20 0 1 20 10 10 2 46 20 20 20 20 3 20 66 4 20 72 18 5 20 130 4 Step 3: TVC at quantity of zero is 0, because no variable inputs needed Step 4: MC = Change in TC / Change in Q. But, Change in Q = 1, So, TC = 66 at an output of 3, since MC = 20 between outputs 2 and 3.

  5. Marginal Cost Puzzle Units Of Output TFC TVC TC MC AFC AVC 0 20 0 20 1 20 10 30 10 2 26 46 20 20 20 20 3 46 20 66 4 20 72 92 18 5 20 110 130 4 Step 5 : TFC + TVC = TC, so working down the first three columns, fill in all of TC and TVC.

  6. Marginal Cost Puzzle Units Of Output TFC TVC TC MC AFC AVC 0 20 0 20 10 1 20 10 30 10 16 2 26 46 20 20 20 20 3 46 46 20 66 26 4 20 72 92 18 38 5 20 110 130 4 Step 6 : Use definition of MC to fill in column MC = Change in Costs / Change in Quantity

  7. Marginal Cost Puzzle Units Of Output TFC TVC TC MC AFC AVC 0 20 0 20 NR NR 10 1 20 10 30 20 10 16 2 26 46 13 20 10 20 20 20 3 46 46 20 66 6.67 15.33 26 4 20 72 92 5 18 38 5 20 110 130 4 22 Step 7 : Use AFC and AVC definitions to fill in Table. AFC x Q = TFC AVC x Q = TVC

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