Question

Short-Run Relationships - Fixed, Variable, and Total Costs Exercise 1 Marcel leases a garage. He must pay $500 every week for his lease regardless of how many cars he fores. The number of cars hef each week depends on how many mechanics he hires. The table below summarizes his cost information Instructions: Enter your answers as a whole number. a. Fill in the missing values for total fixed cost, total variable cost, and total cost in the table below. Marcel's Production Costs Total Fixed Cost Output (dollars) $500 10 500 20 500 Total Variable Cost (dollars) Total Cost (dollars) $500 500 1.000 1,500 2.000 2.500 2,500 b. Graph the total fixed cost, total variable cost, and total cost curves from the data in the table. Instructions: Use the tools provided Total Fixed Cost Total Var. Cost' and 'Total Cost' to plot each curve. Plot each point for all curves (6 points each curve, total of 18 points) Garage Costs TFC, TVC, TC(dollars) 3,500 3,000 Total Fixed Cc Total Var. Cos 2,500 < Prev 8 of 21 III Next >

Answer 1

Excercise 1

(a) Marcel's Production Costs

Output	Total Fixed cost	Total Variable cost	Total Cost
0	500	0	500
10	500	500	1000
20	500	1000	1500
30	500	1500	2000
40	500	2000	2500
50	500	2500	3000

Total fixed cost remains the same at each level of output.

TC = TVC + TFC

TVC=TC-TFC

Excercise (2)

Vinatge Model car production costs

Output	Total Fixed cost	Total Variable cost	Total Cost
0	2500	0	2500
100	2500	500	3000
200	2500	1000	3500
300	2500	2000	4500
400	2500	3000	5500

Total fixed cost remains the same at each level of output.

TC = TVC + TFC

TVC = TC - TFC