How to find fixed cost, total variable cost, and average variable cost?
http://img517.imageshack.us/img517/7091/...
I filled in total revenue, marginal revenue, marginal cost and profit.
I dont know how to find the other 3 columns. Can anyone just give me the forumla so I can start?
Also, Is the level of output that maximizes profit qty 3 at the price $55??
Answer:
fixed costs FC are easy. What are the total costs TC when Q=0 that is fixed costs.
TVC are what are the TC minus FC
AVC what is the AVC / Q
FC = TC when Q=0
TVC = TC - FC
AVC = VC / Q
finally max profits is where MC = MR or as close as you can get. If you could set 2 < Q < 3 you could increase profits but if you can't then 2 or 3 gets the same profit
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