the figure below,$/Q17412511880m59MCAVCATCn484028uQ₂Q3 Q4Q5O total variable cost at Q₂ units of output is represented by the area absv (i.e., TVC(Q)area absv) and totalfixed cost at Q₂ units of output is represented by the area vsQ₂0 (i.e., TFC(Qs) - area vsQ₂0).total variable cost at Q3 units of output is represented by the area ruQ,0 (i.e., TVC(Q)- area ruQ,0) and totalfixed cost at Qs units of output is represented by the area zfnk (i.e., TFC(Qs) - area zfnk).O total cost at Q4 units of output is represented by the area adQ40 (.e., TC(Q) - area adQ40) and total fixedcost at Q4 units of output is represented by the area adgi (i.e.. TFC(Q4) - area adgi).O total variable cost at Q₂ units of output is represented by the area absv (i.e., TVC(Q)- area absv) and totalfixed cost at Q₂ units of output is represented by the area vsQ₂0 (ie.. TFC(Qs) - area vsQ,0).total variable cost at Q3 units of output is represented by the area zhQ₂0 (i.e., TVC(Q)area zhQ,0) and totalfixed cost at Q4 units of output is represented by the area tyQ40 (ie., TFC(Qs) area tyQ40).XXXXXX

Fixed Cost refers to the costs that are incurred even when production is zero. That is, the costs…

$/Q 174 125 118 80 59 48 40 m MC AVC ATC 28 W Q₁ Q₂ Q₂ Q5 total variable cost at Q₂ units of output is represented by the area absv (i.e., TVC(Q₂) - area absv) and total fixed cost at Q₂ units of output is represented by the area vsQ₂0 (i.e., TFC(Qs) area vsQ₂0). total variable cost at Q3 units of output is represented by the area ruQ,0 (i.e., TVC(Qs) - area ruQ,0) and total fixed cost at Qs units of output is represented by the area zfnk (i.e.. TFC(Q₁) - area zfnk). total cost at Q4 units of output is represented by the area adQ40 (i.e., TC(Q4) area adQ40) and total fixed cost at Q4 units of output is represented by the area adgi (i.e... TFC(Q4) area adgi). O total variable cost at Q₂ units of output is represented by the area absv (i.e.. TVC(Q₂) - area absv) and total fixed cost at Q₂ units of output is represented by the area vsQ₂0 (i.e.. TFC(Qs) - area vsQ₂0). total variable cost at Q3 units of output is represented by the area zhQ50 (i.e., TVC(Q)area zhQ,0) and total fixed cost at Q4 units of output is represented by the area tyQ40 (i.e.. TFC(Qs) area tyQ40).

$/Q 174 125 118 80 59 48 40 m MC AVC ATC 28 W Q₁ Q₂ Q₂ Q5 total variable cost at Q₂ units of output is represented by the area absv (i.e., TVC(Q₂) - area absv) and total fixed cost at Q₂ units of output is represented by the area vsQ₂0 (i.e., TFC(Qs) area vsQ₂0). total variable cost at Q3 units of output is represented by the area ruQ,0 (i.e., TVC(Qs) - area ruQ,0) and total fixed cost at Qs units of output is represented by the area zfnk (i.e.. TFC(Q₁) - area zfnk). total cost at Q4 units of output is represented by the area adQ40 (i.e., TC(Q4) area adQ40) and total fixed cost at Q4 units of output is represented by the area adgi (i.e... TFC(Q4) area adgi). O total variable cost at Q₂ units of output is represented by the area absv (i.e.. TVC(Q₂) - area absv) and total fixed cost at Q₂ units of output is represented by the area vsQ₂0 (i.e.. TFC(Qs) - area vsQ₂0). total variable cost at Q3 units of output is represented by the area zhQ50 (i.e., TVC(Q)area zhQ,0) and total fixed cost at Q4 units of output is represented by the area tyQ40 (i.e.. TFC(Qs) area tyQ40).

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter4: Extent (how Much) Decisions

Section: Chapter Questions

Problem 3MC

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