Q. No .4. Consider the following cost information for Yasir’s tea stall.       (Cups of tea per hour) Total Cost in Rs. 0 30 1 33 2 38 3 45 4 54 5 65 6 78 7 93 8 110 9 129 10  150 If Yasir’s fixed cost is Rs 30 Answer the following    iv. Over time Yasir decides to expand his business. In the long run he first experiences economies of scale, followed by constant returns to scale and finally diseconomies of scale as the output increases. Draw a diagram of his ATC in the short run and the long run. Explain this diagram in detail.

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Cost of Production

The entire idea of the cost of production or production cost is applied corresponding, or we can say that it is related to monetary cost. Money cost refers to any money expenditure which the firm or supplier, or producer undertakes in purchasing or hiring factor of production or factor services.