The Costs of Production: Algorithmic End of Chapter Due Sunday 12.03.17 at 11:00

Question

The Costs of Production: Algorithmic End of Chapter Due Sunday 12.03.17 at 11:00 PM Attempts: Do No Harm:6 1. Problems and Applications Q1 This chapter discusses many types of costs: opportunity cost, explicit costs, fixed cost, variable cost, average fixed cost, and average variable cost. Fuir in the type of cost that best completes each sentence. In a pizza industry, the cost of the factory is a(n) y only in the short run but not in the long run is always falling as the quantity of output increases. A cost that depends on the quantity produced is a(n) refers to all the things you must give up for taking some action refers to costs that involve direct monetary payment by the firm. is falling when marginal cost is below it and rising when marginal cost is above it. The term The term Notices Terms of Use Privacy Notice Security Notice Accessibility

Explanation / Answer

1) Fixed cost

Fixed cost is the cost which occurs even at zero level of output.

2) Average fixed cost

AFC = TFC/Q

TFC is fixed so an increase in Q always lead to decrease in AFC.

3) Variable cost

It is the cost which is dependent on quantity. More quantity means more variable cost and vice-versa.

4) Opportunity cost

It is the value of next best alternative foregone.

5) Explicit cost

It is the direct payments made by firm in carrying out business.

6) Average Variable cost

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