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Question
A firm’s average fixed cost, when it produces 2 units, is Rs 30. Its average total cost schedule is given below. Calculate its marginal cost and average variable cost at each level of output.
| Output (Units) | 1 | 2 | 3 |
| ATC (₹) | 80 | 48 | 40 |
Numerical
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Solution
| Output (Units) | ATC (₹) | AFC (₹) | AVC (₹) | TC (₹) | MC (₹) |
| 1 | 80 | 60 | 20 | 80 | - |
| 2 | 48 | 30 | 18 | 96 | 16 |
| 3 | 40 | 20 | 20 | 120 | 24 |
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