Cost curves

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Description and Tags

different types of costs

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9 Terms

1
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Total coast

TC = TVC + TFC

2
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Total variable cost

TVC = 0 if Q = 0

3
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Total fixed cost

constant

4
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Marginal cost

MC = ΔTC/ΔQ or ΔTVC/ΔQ

MC is inversely related to MP and the shape determines the shape of most of the other costs
(except for fixed costs)

5
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Average total cost

ATC = Average Total Cost = TC/Q

ATC = AVC + AFC

6
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Average variable cost

AVC = Average Variable Cost = TVC/Q

7
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Average fixed cost

AFC = Average Fixed Cost = TFC/Q

8
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9
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