Question

4. various measures or cost Douglas Fur is a small manufacturer of fake-fur boots in Detroit. The following table shows the company's total cost of production at various production quantities. Fill in the remaining cells of the following table. Quantity (Pairs) Marginal Cost (Dollars) Fixed Cost (Dollars) Variable Cost (Dollars) Average Variable Cost (Dollars per pair) Average Total Cost (Dollars per pair) Total Cost (Dollars) 60 160 220 270 340 450 630 On the following graph, plot Douglas Fur's average total cost (ATC) curve using the green points (triangle symbol). Next, plot its average variable cost (AVC) curve using the purple points (diamond symbol). Finally, plot its marginal cost (MC) curve using the orange points (square symbol). (Hint: For ATC and AVC, plot the points on the integer; for example, the ATC of producing one pair of boots is $160, so you should start your ATC curve by placing a green point at (1, 160). For MC, plot the points between the integers: For example, the MC of increasing production from zero to one pair of boots is $100, so you should start your MC curve by placing an orange square at (0.5, 100).) Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically.

Answer 1

The given data has been executed in a table using excel

G F ATC TC MC FC VC AVC 100 ni 00 1601 1101 90 3 27050 210 280 390 5701 78 6 630 95 105

MC = Change in TC/Change in Q

FC = TC when Quantity is 0

VC = TC - FC

AVC = VC/Q

ATC = TC/Q

The required graph has been from the calculated data

PRice -MC -AVC ATC 1 2 3 5 6 7 4 Quantity

The excel formula used are shown below:

MC VC AVC JATC =B3-B2 =B4-B3 =B5-B4 =B6-B5 =B7-B6 =B8-B7 =B2-D2 =B3-D3 =B4-D4 =B5-D5 =B6-D6 =B7-D7 =B8-D8 =E3/A3 =E4/A4 =E5/A5 =E6/A6 =E7/A7 =E8/A8 =B3/A3 =B4/A4 =B5/A5 =B6/A6 =B7/A7 =B8/A8 7 8 5 6 630

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