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ECON 220 UNIT 3 IP

ECON 220 UNIT 3 IP - Production 1 Production and Cost...

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Production 1 Production and Cost Effectiveness Is Important In A Firm. BUSN 220 Unit 3 IP May 14, 2011 Cheri Bolin

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Production 2 Abstract In our Unit 3 IP assignment we were asked to calculate the values of four different formulas assuming the total fixed cost is \$1 Million. The formulas are to calculate; the total variable cost, average variable cost, average total cost and worker productivity. We were also asked to recalculate the same variables except we are to assume the total fixed cost is \$3 Million in these calculations. The calculations and descriptive answers are to be put into a report and given to management to review.
Production 3 Production and Cost Effectiveness Is Important In A Firm. In our assignment we were given formulas to calculate the variable costs of a variety of scenarios. No matter what characteristics firms possess; whether they are big or small, vastly reputable or unfamiliar or well known for their market structure, firms must base their operations on a variety of different business strategies. They also must be knowledgeable of supply and demand, as well as, all the costs involved in operating a organization. To determine the values of each variable, we must use the formulas listed below. Total variable cost = (# of workers * workers daily wage) + other variable costs (Krugman & Wells, 2009) Avg. variable cost = total variable cost / units of output per day (Krugman & Wells, 2009) Avg. total cost = (total variable cost + total fixed cost) / units of output per day (Krugman &

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ECON 220 UNIT 3 IP - Production 1 Production and Cost...

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