Question

Following information is given about a firm:

Output (Units)	$0$	$1$	$2$	$3$	$4$	$5$	$6$
Total Cost (Rs.)	$150$	$300$	$420$	$600$	$790$	$1,000$	$1,260$

From this information, find out:
(i) AFC of producing $3$ units, (ii) AVC of producing $4$ units,
(iii) Least AC level of output, (iv) MC of producing $5th$ unit, and (v) TVC of producing $6$ units.

Answer 1

Output (Units)	Total Cost (Rs.)	Total Fixed Cost (Rs.)	Average Fixed Cost (Rs.)	Total Variable Cost (Rs.)	Average Variable Cost (Rs.)	Marginal Cost (Rs.)	Average Cost (Rs.)
$0$ $1$ $2$ $3$ $4$ $5$ $6$	$150$ $300$ $420$ $600$ $790$ $1,000$ $1,260$	$150$ $150$ $150$ $150$ $150$ $150$ $150$	$\infty$ $150$ $75$ $50$ $37.5$ $30$ $25$	- $150$ $270$ $450$ $640$ $850$ $1,110$	- $150$ $135$ $150$ $160$ $170$ $185$	- $150$ $120$ $180$ $190$ $210$ $260$	$\infty$ $300$ $210$ $200$ $197.5$ $200$ $210$

(i) AFC of producing $3units=Rs.50$.
(ii) AVC of producing $4units=Rs.160$.
(iii) Least AC level of output $=4units$.
(iv) MC of producing $5thunit=Rs.210$.
(v) TVC of producing $6units=Rs.1,110$.