# Identify two ways to compute average total cost (ATC).

## Question:

Identify two ways to compute average total cost (ATC).

## Average Total Cost:

The average total cost (ATC) refers to the estimated cost of one unit of production. ATC is not normally the same throughout the production level. It changes with the change in the total number of units produced. This is because some costs are affected by changes in production level while some costs do not.

## Answer and Explanation: 1

Become a Study.com member to unlock this answer! Create your account

View this answer#### First Method:

First, determine the total variable cost (TVC) and the total fixed cost (TFC). We can identify the total variable cost when the item...

See full answer below.

#### Ask a question

Our experts can answer your tough homework and study questions.

Ask a question Ask a question#### Search Answers

#### Learn more about this topic:

from

Chapter 3 / Lesson 23Learn what is the average total cost. Learn its use, its formula, and how to apply it.

#### Related to this Question

- Define and explain how to calculate average total costs (ATC).
- Determine the distance between the average total cost (ATC) and the average variable cost (AVC).
- Why Average total cost (ATC) is always in a U-line shape?
- Define and give a formula for : - Average Fixed Cost (AFC) - Average Variable Cost (AVC) - Average Total Cost (ATC)
- According to the table below, what will the average total cost (ATC) at 3 units of output? A. $500 B. $1,400 C. $700 D. $3,500 E. $1,167
- Define and know how to calculate average total cost.
- Calculate the average fixed cost and average variable cost based on this data.
- Define and know how to calculate average variable cost.
- Define the long-run average total cost.
- Retrieve the average total cost function given that the total cost = Q^2 + 5Q + 6.
- Which of the following is an INCORRECT statement about average total cost (ATC)? a. ATC = \frac {(VC + FC)}{Q}, b. ATC = \frac{TC}{Q} . c. ATC = AVC + AFC d. ATC = MC if MC is at a minimum. e. All of the above are correct.
- How can I calculate variable cost and average variable cost?
- In the short run, if a firm finds that its price (P) is less than its average total cost (ATC), should it shut down its operation?
- How do you solve for average fixed cost and average variable cost?
- How do you determine a firm's long-run average cost curve?
- Describe the total cost formula and its variables. Discuss each variable both in total and average cost calculations.
- How is the long-run average total cost curve derived?
- Define and know how to calculate total cost.
- If the total cost function is TC = 10Q^3 - 50Q^2 + 1000Q + 5, what is the equation for ATC?
- How can the long-run average cost (LRAC) curve be derived from the short-run average total cost (SRATC) curve?
- If the average variable cost (AVC) is $74 and the total fixed cost (FC) is $100 at 5 units of output, then the average total cost (ATC) at 5 units of output is: a. $91. b. $94. c. $97. d. $100.
- Explain the long run average total cost curve.
- When Total Costs (TC) are known, explain how to calculate each of the following: a. Fixed Costs (FC) b. Variable Costs (VC) c. Average Variable Costs (AVC)
- The average total cost (ATC) and average variable cost (AVC) converge as the level of output produced increases because ____.
- How do you find the total cost when only the output and TVC are listed?
- Explain the meaning of average cost.
- Average total cost is equal to the sum of _____.
- What is the difference between average total cost and average variable cost?
- Answer ALL Question You are given the following cost functions: TC = 100 + 60Q - 3 Q2 + 0.1 Q3 TC = 100 + 60Q + 3 Q2 TC = 100 + 60Q a) Compute the average variable cost, average cost, and margina
- Define and know how to calculate variable costs.
- What is the sum of average variable costs and average fixed costs for a given output?
- What is the relationship between the total cost concept and average cost concepts? For instance, if you know the total cost and quantity, how do you calculate the average total cost?
- Suppose q=K^1/3L^2/3, K=10, and w = v = 3. Find the short run total cost curve and short run average total cost curve.
- If the price/MC is given, how do you find the total cost and output?
- How does the average variable cost curve help a firm know whether it should shut down immediately?
- Define the total cost (TC), average fixed cost (AFC), average variable cost (AVC), average cost (AC), and marginal cost (MC).
- In the short run the average variable cost can be obtained by each of the following except a ATC MC b ATC AFC c TC Q TFC Q d TVCQ
- Total cost and total variable cost are parallel, yet average total cost and average variable cost are not parallel. a. Demonstrate mathematically that ATC and AVC are not parallel. b. Show mathematica
- If Dell makes 10 computers, its total cost is $13,000. If Dell makes 11 computers, its total cost is $14,500. Calculate the ATC at 11 computers.
- If Dell makes 10 computers, its total cost is $13,000. If Dell makes 11 computers, its total cost is $14,500. Calculate the ATC at 10 computers.
- Define average fixed cost, average total cost, average variable cost, as well as total cost, total fixed cost and total variable cost.
- Find the hospital's run total cost function. Find the hospital's long run average cost function.
- Why is the long-run average total cost curve normally u-shaped?
- Why is the Average Total Cost curve U-shaped?
- Explain how to solve for variable cost without total cost and if only fixed cost is given.
- How is the average variable cost related to the variable cost?
- Discuss the long-run average cost curve of a firm and how it represents return to scale. Substantiate your answer with the aid of a diagram.
- How is the formula for total variable cost determined?
- DEFINE THE FOLLOWING TERMS: AVERAGE FIXED COST AVERAGE TOTAL COST AVERAGE VARIABLE COST TOTAL COST TOTAL FIXED COST TOTAL VARIABLE COST.
- A firm's short-run average cost function is ATC(Q) = 1000/Q + 75,000 + Q, where Q is output and ATC is the average total cost. What is the output that minimizes the average total cost?
- How do I find fixed cost with total cost and quantity?
- Calculate average variable cost when given: fixed cost 500 quantity 100 price 11.00 PED = -2.2
- Cost-curve shifters The following graph shows the average total cost (ATC) curve, average variable cost (AVC) curve, and average fixed cost (AFC) curve for Alyssa's Pizza Parlor when Alyssa pays her
- Suppose that price is below the minimum average total cost (ATC) but above the minimum average variable cost (AVC) and the market price is expected to rise at least to ATC in the near future. In the short run, a firm that is a price taker would a. immedi
- The total cost for a monopoly is calculated by: A. Price x Output B. quantity produced x ATC (average total cost) C. Price x MR
- Differentiate with examples, total cost (TC), total fixed cost (TFC) and total variable cost (TVC).
- At any output at which ATC is tangent to LAC: a. LMC=SMC. b. economies of scale must be present. c. long-run total cost (LTC) equals short-run total cost (TC). d. both a and c. e. all of the above.
- A firm will shut down in the long-run if the a) price is above the minimum average total cost (ATC). b) price is equal to the minimum average total cost (ATC). c) price is anywhere above the minimum average variable cost (AVC). d) price is anywhere be
- Fill the ATC and MC columns in the following table: |Output|Total cost|Average total cost|Marginal cost |0|$14| | |1|$15| | |2|$18| | |3|$24| | |4|$36| | a. Use the MC curve to determine how many units (Q) this firm will supply if the market price were
- What are the average variable cost and average total cost curves for a typical firm? (Include the MC curve.)
- What is the relationship between average fixed costs, average variable costs, and average total costs?
- In answering the following questions, refer to the table below which shows average total costs (ATC) for a manufacturing firm whose total fixed costs are $10. Output ATC 1 $40 2 $27 3 $29 4 $31 5
- Consider the following cost function: c(y) = 4y^2 + 16. Write down the expression for the average variable cost.
- The average total cost (ATC) of producing a bell is $5 when Jenny's Jingles produces 100 bells. Total cost when zero bells are produced is $250. Average fixed cost (AFC) when 100 bells are produced is equal to A) $2.50 B) $5.00 C) $7.50 D) $10.00
- The total cost function of a firm is given by C =.04q^3 -.9 q^2 + 10q + 10. Find the slope of average COS.
- Consider the following cost function: c(y) = 4y^2 + 16. Write down the expression for the average cost function.
- In the long run equilibrium, a monopolistic competitor will produce to the point at which A) actual average total costs are at the minimum of possible ATC B) actual average total costs are higher th
- The average total cost (ATC) of producing a bell is $5 when Jenny's Jingles produces 100 bells. Total cost when zero bells are produced is $250. The total variable cost (TVC) of producing 200 bells is equal to A) $250 B) $500 C) $750 D) $1,000
- Fill in the table. What is the ATC for an output of 3? ||Output||Variable cost||Total Cost||AFC||AVC||ATC||Marginal cost |1|180| | | | | |2|260| | | | | |3|380| | | | | |4|490| | | | | |5|760| | | | |
- The long-run average cost curve can be derived by _____.
- The average variable cost is equal to the average cost _.
- A. Consider the following data. Assume that the fixed cost of the 3rd unit of output is $9.00. Calculate average fixed cost, average variable cost, average total cost, marginal costs, total variable c
- The average total cost (ATC) curve for a perfectly competitive firm is most often U-shaped because of the effect of ........ at lower quantities and ......... at higher quantities. (Note: In the answe
- Assume that you observe the long-run average cost curve of Acme Bookstores, a national chain. Starting from the point on the curve where output is zero and moving to the right which of the following lists the behavior of long-run average costs in the corr
- Suppose a cost function is TC = Aq^3 + bq^2 + cq + d. Then the average variable cost is what?
- The statements and equations below show various ways of defining average variable cost, marginal cost, and average total cost. Below, TC is used to abbreviate total cost, VC is used to abbreviate Vari
- Use the definitions for TFC, TVC, TC, AFC, AVC, ATC and SMC along with the data provided below to fill in the missing values. Total Product Total Fixed Cost Total Variable Cost Total Cost Average Fixed Cost Average Variable Cost Average Total Cost Margin
- Fill in the following Chart Pancakes Fixed Cost Variable Cost Total Cost Marginal Cost Average Variable Average Fixed Average Total 1 _____ _____ _____ _____ _____ _____ 250 2 _____ _____ _____ 100 _
- What relation does average variable cost and average total cost have if the total fixed cost is zero?
- The vertical distance between ATC and AVC measures: a. marginal cost b. total fixed cost c. average fixed cost d. economic profit per unit
- Make three lists titled Average Variable Cost, Marginal Cost, and Average Total Cost comprising these statements and equations below to show which ones are appropriate to define the title. TC is used
- Average cost equals total cost quantity. a. minus b. times c. divided by d. plus
- Average variable cost is [{Blank}].
- Firms will always make a positive economic profit if the price they charge is: a. less than their minimum average total cost (ATC). b. equal to their minimum average total cost (ATC). c. less than their minimum average variable cost (AVC). d. greater
- Firm will shut down in the long-run if the (a) price is above the minimum average total cost (ATC) (b) price is equal to the minimum average total cost (ATC) (c) price is anywhere above to the minimum average variable cost (AVC) (d) price is anywhere belo
- Consider the following total cost. A. Find the average fixed cost (AFC), average variable cost (AVC), and marginal cost (MC) for each quantity. B. Draw the respective curves for the variables in A. C. Find the approximate quantity at which AVC = MC.
- Economics and finance have two different meanings when it comes to total cost. To an economist, what does "total cost" mean?
- In economics, the term "total cost" is used interchangeably, especially in the theory of firms. What does the total cost imply?
- Explain the relationship between price and average total cost for a perfectly competitive firm.
- How do I determine the right dollar amount to give in a for-profit business w/a giving model? The average cost of a product would be $40-$50.
- Using the table, determine the average variable cost of producing 27 units. ||Q||FC||VC |0|500|0 |8|500|250 |17|500|500 |27|500|750 |40|500|1000 |54|500|1250 |66|500|1500 |76|500|1750 |84|500|2000 |91|500|2250 |96|500|2500 A. $ 46.30 B. $ 29.41 C. $ 27.7
- Average total cost is equal to which one and why? output/total cost total cost-total quantity of output average variable cost+total fixed cost total cost/output
- How does one show on a graph, a fall in average costs linked to economies of scale for a firm?
- If the average total cost is $50 and the average fixed cost is $15 when output is 20 units, what is the firm's total variable cost at that level of output?
- Complete the following table where Q is the total production. VC is the variable cost. TC is the total cost MC is the marginal cost, and ATC is the average total cost, and the fixed cost is $10.
- If the total cost is $20,000 and the variable cost is $10,000 at an output of 10,000. What is the average fixed cost?
- A firm has the following total cost function: STC=900+50Q-2.7Q^2+0.045Q^3 a. Write equations for average fixed cost and average variable cost, and marginal cost. b. At what level of output will averag
- Suppose that a firm's long-run total cost curve can be expressed as TC=20Q2+20Q. Give an expression for the firm's long-run average total cost curve.