Econ Quiz on 11/7/23
Total costs (TC)
fixed + variable costs
Average Total Cost (ATC)
TC/Q
Average Fixed Cost (AFC)
TFC/quantity
Average Variable Cost (AVC)
TVC/quantity
Fixed Costs (FC)
Costs that do not vary with the quantity of output produces.
Variable Costs (VC)
Costs that vary with the quantity of output produced
Variable Costs example
Labor, energy, materials
Transaction Cost Example
Looking for schools, we need information to make a decision, which takes time and cost.
Example of Fixed Cost
Rent, insurance, taxes
Transaction Costs
The cost of consummating an economic transaction
Opportunity costs
Whatever must be given to obtain some item
Opportunity cost example
With Covid most agree social distancing is necessary, others argue that the opportunity cost of doing so is too high in terms of an economic slowdown
Marginal Cost (MC)
change in TC/change in Q
Marginal Revenue (MR)
change in TR/change in Q