Economics
5th Edition
ISBN: 9781319066604
Author: Paul Krugman, Robin Wells
Publisher: Worth Publishers
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Question
Chapter 11, Problem 10P
To determine
Concept Introduction:
Here,
- AFC is the average fixed cost.
- AVC is the
average variable cost . - ATC is the average total cost.
Marginal Cost (MC): It refers to the rate by which the total cost of the produced good changes when the production increases by a single unit. As the fixed cost is constant irrespective of production, so the marginal cost depends on the variable cost only in the short run. Marginal cost is calculated as follows:
Here,
is the marginal cost. 
is the change in total cost 
is the change in quantity.
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