Microeconomics: Principles & Policy
14th Edition
ISBN: 9781337794992
Author: William J. Baumol, Alan S. Blinder, John L. Solow
Publisher: Cengage Learning
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Question
Chapter 7, Problem 1TY
To determine
To find: The table showing TFC and AFC and the curve of these costs.
Expert Solution & Answer
Explanation of Solution
Below is the complete table. Here, the average fixed cost is calculated by dividing the total fixed cost by outputs.
Output | Total Fixed cost (fig. in thousands) | AFC (fig. in thousands) |
0 | 360 | 0 |
1 | 360 | 360 |
2 | 360 | 180 |
3 | 360 | 120 |
4 | 360 | 90 |
5 | 360 | 72 |
6 | 360 | 60 |
Below is the curve that shows the total fixed cost curve and the average fixed cost curve. Here, the horizontal axis shows the output. While the vertical axis shows the price or costs.
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Chapter 7 Solutions
Microeconomics: Principles & Policy
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