Question

Study the cost function of a firm given below:

| Output (Units) | 0 | 1 | 2 | 3 |
| TC (₹) | 30 | 90 | 110 | 120 |

Calculate : AFC, AC and MC.

Answer 1

| Output (Units) | TC | AFC | AC | MC |
| 0 | 30 | - | - | - |
| 1 | 90 | 30 | 90 | 60 |
| 2 | 110 | 15 | 55 | 20 |
| 3 | 120 | 10 | 40 | 10 |