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Economics Lecture Eight (view source)
Revision as of 23:25, October 27, 2009
, 23:25, October 27, 2009→Equations of Medium Difficulty
===Equations of Medium Difficulty===
===Equations of Medium Difficulty===
:At Q = 0, TC = TFC
:At Q = 0, TC = TFC
::When quantity produced is 0, the total costs are total fixed costs.
:At Q = 1, MC = TVC
:At Q = 1, MC = TVC
::When quantity produced is 1, the marginal cost is total variable cost.
:At all Q > 0, AVC = TVC / Q
:At all Q > 0, AVC = TVC / Q
::Whenever quantity produced is greater than 0, average variable cost equals total variable cost divided by quantity.
:At all Q > 0, AFC = TFC / Q
:At all Q > 0, AFC = TFC / Q
::Whenever quantity produced is greater than 0, average fixed cost equals total fixed cost divided by quantity.
:At all Q, ATC = AVC + AFC
:At all Q, ATC = AVC + AFC
::At any quantity, average total cost equals average variable cost plus average fixed cost.
:TVC = sum of MC
:TVC = sum of MC
:TFC = Q x AFC
:TFC = Q x AFC