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Indicate how each of the following would shift 1. the marginal cost curve 2. the average variable cost curve 3. the average fixed cost curve and 4. the average total cost curve of a manufacturing firm?
Vctrhogan
a. Property taxes are fixed costs, so this would decrease AFC, which in turn decreases ATC.
b. Wages are typically variable costs, so this would increase both MC and AVC, which in turn increases ATC.
c. Electricity is typically a variable cost, so this would decrease both MC and AVC, which in turn decreases ATC,
d. Insurance is a fixed cost, so this would increase AFC, which in turn increases ATC.
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∙ 11y ago
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Marginal versus variable costing?
Variable cost refers to the TOTAL variable cost of all units, whereas marginal cost is the variable cost of the last unit only. Variable cost is the sum of all the individual marginal costs. The derivative of the Variable Cost is the Marginal Cost. The integral of the Marginal cost is the Variable Cost.
What is happening to average variable costs when they equal marginal costs?
When average variable costs equal to the average marginal cost, the average variable cost will be at the minimum point. i.e. lowest cost
What are increasing marginal returns?
ncreasing marginal returns mean that marginal product is greater for each subsequent unit of a variable input than it was for the previous unit. Decreasing marginal returns, as such, mean that marginal product is less for each subsequent unit of a variable input than it was for the previous unit.
Do fixed and variable costs affect short-run marginal cost?
Fixed costs do not affect short-run marginal cost because they are just that- fixed. They are not dependent on quantity when it changes and does not vary directly with the level of output. Variable costs, however, do affect short-run marginal costs.
Example of the law of diminishing marginal productivity?
The law of diminishing marginal product states that as a firm uses more of a variable resource with a fixed resource and fixed technology, the marginal product of the variable resource will fall. From related site.
Marginal versus variable costing?
Variable cost refers to the TOTAL variable cost of all units, whereas marginal cost is the variable cost of the last unit only. Variable cost is the sum of all the individual marginal costs. The derivative of the Variable Cost is the Marginal Cost. The integral of the Marginal cost is the Variable Cost.
Is Manufacturing cost is overhead or variable?
Manufacturing cost is variable cost.
When calculating total cost do you add in variable manufacturing overhead fixed manufacturing overhead or both?
Following is the formula for total costtotal cost = fixed overheads + variable overheads + direct labor + direct material
What is happening to average variable costs when they equal marginal costs?
When average variable costs equal to the average marginal cost, the average variable cost will be at the minimum point. i.e. lowest cost
What are increasing marginal returns?
ncreasing marginal returns mean that marginal product is greater for each subsequent unit of a variable input than it was for the previous unit. Decreasing marginal returns, as such, mean that marginal product is less for each subsequent unit of a variable input than it was for the previous unit.
Which symbol is used with a variable to indicate to the script that you are reading the contents of that variable?
Which symbol is used with a variable to indicate to the script that you are reading the contents of that variable?
Is another term for variable costing?
It May Be Called as "Marginal Cost"
What is another term for variable costing?
It May Be Called as "Marginal Cost"
What is the connection between marginal returns and variable costs?
they are usually inversly proportional
What gives the probability of each random variable?
The marginal probability distribution function.
Do fixed and variable costs affect short-run marginal cost?
Fixed costs do not affect short-run marginal cost because they are just that- fixed. They are not dependent on quantity when it changes and does not vary directly with the level of output. Variable costs, however, do affect short-run marginal costs.
Example of the law of diminishing marginal productivity?
The law of diminishing marginal product states that as a firm uses more of a variable resource with a fixed resource and fixed technology, the marginal product of the variable resource will fall. From related site.
