Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Fixed costs are those which are independent of output that is they do not change with changes in output. These costs are a fixed amount which must be incurred by a firm in the short run whether output is small or large. Even if the firm closes down for some tie in the short run but remains in business these costs have to be borne by it. Fixed costs are also known as overhead costs and include changes such as contractual rent insurance fee maintenance costs property taxes interest on the capital invested minimum administrative expense such as mange salary watchman’s wages etc. thus fixed cost are those which are incurred in hiring the fixed factor of production whose amount cannot be altered in the short run.Variable Costa on the other hand is those costs which are incurred o the employment of variable factors of production whose amount can be altered in the short run. Thus the total variable costs change with changes in output in the short run they increase or decrease when the output rises or falls. These costs include payments such as wages of labour employed price of the raw materials fuel and power used, the expenses incurred on transporting and the like. If a firm shuts down for some time in the short run, then it will not use the variable factors of production and will not therefore insure any variable costs increase with the increase in the level of production. Variable costs are also called prime costs or direct costs. Total coats fo a business is the sum of its total variable costs and total fixed costs. ThusTC = TFC + TVCWhere TC stands for total cost TFC for total fixed cost and TVC for total variable cost,Because one component the total variable cost (TVC) varies with the changes in output the total cost of production (TC) will also change with the changes in the level of output. The total cost increases as the level of output rises.It should be noted that total cost (TC) is a function of total output (Q) the greater the output the greater will be the total cost in symbols we can writeTC = f(Q)Where Q stands for outputWe can prove this as followsTC = TFC + TVC.
The price of a laptop increases by 20% and there is a 40% drop in the quantity demanded. What would answer be
1. Seller has ample time to adjust to price change. 2. Buyer's response to small price change is significant. 3. Buyers are faced with many options when deciding to make a
Can this be done now?
Explain the key assumptions and desired properties commonly used economics. Economists generally make all or some of the given key assumptions and a condition while they study
New developments
The functions of money include; (1) medium of exchange, (2) store of value, and (3) a calculate of worth. Due to money is acceptable as a form of payment for all commodities,
Former communist economies which is, with varying degrees of enthusiasm and have embraced CAPITALISM.
Why does a price index based on constant weights tend to overstate inflation in periods after the base year when the price of one good is rising quickly compared to other goods?
The minimum wage was increased in 1996 amid cries by various economists that it would cause unemployment. Critics shown that the last time the minimum wage went up the si
the fours laws of chemical combination
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd