Question

The following table shows the total cost schedule of a firm.

Calculate TVC, AFC, AVC, SAC and SMC schedules.

Quantity	TC
1	20
2	70
3	110
4	140
5	160
6	170
7	170

TVC = Total Variable Cost, AFC = Average Fixed Cost, AVC = Average Variable Cost, SAC = Short run Average Cost, SMC = Short run Marginal cost)

Answer 1

TC = TFC + TVC

AFC = \(\frac{TFC}{Q}\) , AVC = \(\frac{TVC}{Q}\), SAC = \(\frac{TC}{Q}\)

SMC = TC_n - TC_n-1