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Cost of Production - output changes – only incurred in...

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Cost of Production Opportunity Costs Opportunity costs can be either variable, fixed, or total Total Variable Cost (TVC)- Total cost of variable inputs (inputs that change as output changes). Total variable costs increase as production increases (need more variable inputs to produce more output). TVC = X1 x Px1 Total Fixed Cost (TFC)- Total cost of fixed inputs (inputs that do not change as
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Unformatted text preview: output changes – only incurred in the short run) • Total Costs (TC) Cost Concepts • Average Total Cost- Average cost to produce 1 item. Total cost / output • Average Variable Cost- total variable cost / output • Average Fixed Cost- total fixed cost / output • Marginal Cost- Change in cost / change in output...
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