variable cost plus fixed cost.
In a perfectly competitive market, all n firms are equal. Thus, the market total cost is the total cost (TC) of one firm multiplied by the amount of n firms in the market Total Market Cost = n(TC) Total cost relates to output because firms want to make a profit. Profit = TR - TC where TR = total cost and TR = total revenue. Firms produce at the quantity which MR (marginal revenue) = MC (marginal cost). At this quantity, multiply it by n number of firms in the market to achieve the total output in a market.
In a perfectly competitive market, all n firms are equal. Thus, the market total cost is the total cost (TC) of one firm multiplied by the amount of n firms in the market Total Market Cost =Variable Costs and fixed costs ...Fixed costs plus variable costs.
At this intersection point on a graph, firms will earn maximum profit, even if this point is under average total cost.
No it does not. Only Perfectly Competitive firms have a horizontal Marginal Cost curve, which is also there demand curve.
Check
In a perfectly competitive market, all n firms are equal. Thus, the market total cost is the total cost (TC) of one firm multiplied by the amount of n firms in the market Total Market Cost = n(TC) Total cost relates to output because firms want to make a profit. Profit = TR - TC where TR = total cost and TR = total revenue. Firms produce at the quantity which MR (marginal revenue) = MC (marginal cost). At this quantity, multiply it by n number of firms in the market to achieve the total output in a market.
In a perfectly competitive market, all n firms are equal. Thus, the market total cost is the total cost (TC) of one firm multiplied by the amount of n firms in the market Total Market Cost =Variable Costs and fixed costs ...Fixed costs plus variable costs.
In a perfectly competitive market, all n firms are equal. Thus, the market total cost is the total cost (TC) of one firm multiplied by the amount of n firms in the market Total Market Cost =Variable Costs and fixed costs ...Fixed costs plus variable costs.
its average total cost will decrease as production increases question from e2020 test.
At this intersection point on a graph, firms will earn maximum profit, even if this point is under average total cost.
At this intersection point on a graph, firms will earn maximum profit, even if this point is under average total cost.
At this intersection point on a graph, firms will earn maximum profit, even if this point is under average total cost.
about cost reduction
No it does not. Only Perfectly Competitive firms have a horizontal Marginal Cost curve, which is also there demand curve.
1) for cost control 2) comparison of cost with other firms 3) for cost reduction
Check
a perfectly competitive firms supply curve will be the portion of the marginal cost curve which lies above the average variable cost curve (AVC)..this will be due to the firms unwillingness to supply below the price in which they could cover their variable costs