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Economics Cost Curves - PLEASE HELP

  • 07-02-2014 1:25pm
    #1
    Obsolete01
    Registered Users Posts: 197 ✭✭


    Hello there,

    I recently started doing Economic Curves in class and i am really struggling with the ones below:

    Marginal Cost Curves in Short Run
    Marginal Revenue in Short Run
    Marginal Cost Curves in Long Run
    Marginal Revenue in Long Run
    Total Average Cost
    Average Variable Cost
    Average fixed cost

    Can anyone help me understand these please.


Comments

  • #2
    noodler
    Registered Users, Registered Users 2 Posts: 26,522 ✭✭✭✭noodler


    Do you understand the basic terms? Marginal? Average? Total? In this context?

    i.e. Total Costs (TC) = Variable Costs (VC) + Fixed Costs (FC)

    The Total Average Cost is simply TC / Q


    Marginal just means the marginal cost or revenue as a result of producing one extra unit of quantity.



    If you are looking for information on where these intersect (i.e. MC = MR etc) then consulting the textbook would be more useful than anything I can do here (because I obviously can't really post graphs etc).

    If you get a bit more specific, let me know and I'll see if I can help you.


  • #3
    Obsolete01
    Registered Users Posts: 197 ✭✭Obsolete01


    noodler wrote: »
    Do you understand the basic terms? Marginal? Average? Total? In this context?

    i.e. Total Costs (TC) = Variable Costs (VC) + Fixed Costs (FC)

    The Total Average Cost is simply TC / Q


    Marginal just means the marginal cost or revenue as a result of producing one extra unit of quantity.



    If you are looking for information on where these intersect (i.e. MC = MR etc) then consulting the textbook would be more useful than anything I can do here (because I obviously can't really post graphs etc).

    If you get a bit more specific, let me know and I'll see if I can help you.

    I meant like definitions :)


  • #4
    noodler
    Registered Users, Registered Users 2 Posts: 26,522 ✭✭✭✭noodler


    Obsolete01 wrote: »
    I meant like definitions :)

    Are they not self-explanatory?

    Not being funny.

    But a fixed cost is one that the company has to pay regardless of the quantities it produces, whereas a variable cost increases with each unit the company produces. Total costs are just the sum of these two.

    i.e. the lights and heating being on the factory floor can be seen as a fixed cost because they need to be on no matter how much the factory is producing, whereas the raw materials are a variable cost because you need more of them for each unit you produce.

    Are you leaving cert or university level btw?


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