Fill in the blanks in the table below. The problem is a "puzzle" so the blanks are not necessarily filled in sequentially. Hint: Determine the total fixed cost first.
Explanation
Total fixed cost is the same as the average fixed cost when output = 1. So total fixed cost = $10. Since total cost = total fixed cost when output is zero, total cost = $10 and total variable cost = $0 when output is zero. Average fixed cost when output = 2 equals $10/2 = $5. Total variable cost when output = 3 is average total cost ($12.63) minus average fixed cost ($3.33) multiplied by output (3) = $27.90. Average total cost when output = 1 is total cost/1 = $19.76. Total cost when output = 5 is average total cost ($10.86) multiplied by output (5) = $54.30. Marginal cost when output = 3 is total cost when output = 3 ($37.90) minus the total cost when output = 2 ($29.06) = $8.84. Marginal cost when output = 5 is total cost when output = 5 ($54.30) minus the total cost when output = 4 ($46.31) = $7.99.
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Explanation
Total fixed cost is the same as the average fixed cost when output = 1. So total fixed cost = $10. Since total cost = total fixed cost when output is zero, total cost = $10 and total variable cost = $0 when output is zero. Average fixed cost when output = 2 equals $10/2 = $5. Total variable cost when output = 3 is average total cost ($12.63) minus average fixed cost ($3.33) multiplied by output (3) = $27.90. Average total cost when output = 1 is total cost/1 = $19.76. Total cost when output = 5 is average total cost ($10.86) multiplied by output (5) = $54.30. Marginal cost when output = 3 is total cost when output = 3 ($37.90) minus the total cost when output = 2 ($29.06) = $8.84. Marginal cost when output = 5 is total cost when output = 5 ($54.30) minus the total cost when output = 4 ($46.31) = $7.99.
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