Draw one graph of atc and avc, Econometrics

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Costs.  a.  Complete the following table. 

Total Product (Q)

Total Fixed Cost

Total Variable Cost

Total Cost

Average Fixed Cost

Average Variable Cost

Average Total Cost

Marginal Cost

0

$60

$0

$60

-

-

-

-

1

$60

 

$105

 

 

 

 

2

 

$85

 

 

 

 

 

3

 

$120

 

 

 

 

 

4

 

$150

 

 

 

 

 

5

 

 

$245

 

 

 

 

6

 

$225

 

 

 

 

 

7

 

 

$330

 

 

 

 

8

 

$325

 

 

 

 

 

9

 

$390

 

 

 

 

 

10

 

 

$525

 

 

 

 

b.  Draw one graph of ATC, AVC and MC.  Draw another graph with TC.

c.  What happens to ATC as Q increases?

d.  Where does MC cross AVC?  ATC?

e.  Suppose fixed costs increase by $20.  How will this affect TFC, TVC, TC, ATC, AVC and MC? Which numbers change and which stay the same?

f.  Suppose raw material prices increase by 20%.  How will this affect TFC, TVC, TC, ATC, AVC and MC?


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