Total Cost Curves

# Total Cost Curves - cost curves have been drawn accordingly...

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Total Cost Curves: Let us begin with a picture of Total Cost, Total Fixed Cost and Total Variable Cost Curves. This is simpler and easier to understand. With increasing units of output: 4, 11, 18, 23, 25 and 26, Total Fixed Cost remains constant at \$40. Total Variable Cost increases proportionately as 10, 20, 30, 40, 50 and 60. The Total Cost as a sum of the two (Total Fixed and Total Variable Costs) increases as 50, 60, 70, 80, 90 and 100. In the figure three

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Unformatted text preview: cost curves have been drawn accordingly. Total Output Units have been measured along the horizontal axis and Total Costs have been shown on the vertical axis. At a distance of 40 units we find T - FC as a line parallel to OX axis. This shows that even at zero output level TC is equivalent to FC. From here onwards TC rises continuously and in the same proportion as VC. Therefore VC and TC are parallel curves....
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## This note was uploaded on 11/26/2011 for the course ECON MICRO ec 201 taught by Professor - during the Fall '10 term at Montgomery.

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Total Cost Curves - cost curves have been drawn accordingly...

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