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.
what is reciprocal demand?
Raise or Lower Tuition? Suppose that, in an attempt to raise more revenue, Nobody State University increases its tuition. Assess a raise in tuition and if it will necessarily res
What is Modern Economics? Modern Economics: Modern economics mostly developed within last sixty years, methodically studies individuals’ economic behavior as well as econo
Use a PPF to explain the difference between actual and potential growth. The PPF shows possible output, taking into consideration all factors of production - but de facto outpu
Surplus: Anysector or agent in economy (business, householdor government) experiences a surplus when its income surpasses its expenditure. Surplus, Economic: For the economy
Terms of Trade: The ratio of average price of a country's exports, to average price of its imports, is its terms of trade. Theoretically an improvement in a country's terms of trad
Economic Reforms and Reduction of Regional Disparities: Another important objective of development is to reduce regional disparities. Government has been helping the backward
Derivation of compensated demand curve: Hicksian compensated demand function for x 1 is given by x 1 =x 1 (p 1 , p 2 , U), where Hicksian compensated demand curve for a good
how to start an assignment
The concept of opportunity cost occupies a very important place in modern economic analysis. The opportunity cost of any good is the next best alternative goods that are sacrificed
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: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd