Unit 1; Day 5

Fixed cost- Cost that does not change eg. rent, mortgage, insurance, salary

Variable Cost- Rises or falls depending on how much is produced eg. electricity summer+winter
Marginal Cost- cost of producing 1 more unit of a good

Total Fixed Cost= TFC; Total Variable Cost= TVC; Total Cost= TC; AFC= Average Fixed Cost; AVC= Average Variable Cost; AVT= Average Total Cost; Q= Quantity.
TFC+TVC= TC
AFC+AVC= ATC
TFC/Q=AFC
TVC/Q=AVC
TC/Q=ATC
TFC=AFC*Q
TVC=AVC*Q

TCn-TCn-1= MC