Suppose for a particular firm the only variable input into the production process is labor, and that output equals zero when no workers are hired.  If the average total cost (ATC) is $30 when 5 units of output are produced, and if marginal cost (MC) of the 6th unit of output is $60, what’s the average total cost (ATC) for 6 units of output?

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Isocost and Isoprofit Curve Analysis

An isocost curve in the production theory that is a crucial part of economics depicts different combinations of factor inputs at a given market cost. In other words, this shows all the combinations of production factors that cost the same for the firm to employ. Usually, this can be depicted as a downward sloping straight line when the firms act as the price-takers in the factor markets. The slope of this mainly depicts the relative prices of different production factors.