![]() ![]() And so then the average variable cost should start sloping up. But as soon as the marginal curve crosses the average variable cost and the marginal cost,Įvery incremental unit is now more than the average, well that should bring up the average. Is a little big cheaper to produce, so it brings down the average. I won't go into all the details on what's happeningĮxactly right over there, but that early stage, as we see that while our marginal cost is less than our average variable cost, our average variableĬost is trending down. We produce more and more, our average variable cost should go down, and we see that happening When the marginal cost is less than the average variable cost, well that means that as Now, before I actuallyĭraw into this scurve, connect the dots, so let's just think about how the average variable cost relates to the marginal cost. And then, this we did this one, and then at 70 units, we're at 257. 65 is, and then we get to 231 which is right maybe about there. 58 units, it is 207, so it's going to be right about there. So at 45, units our average variable cost is right over there. And then when we are at 45 units, our average variable cost is 200. So 25, we are going to be at $240, which is right about, right about there. So, at an output of 25, our average variable cost is $240. That relates to the curves for average variable costĪnd average total cost. So, that's our marginal, marginal cost curve. And here we've kinda graphed it based on where we are in terms of output. So at 70 we get to 600Īnd I'm eyeballing it, that's not exact graph paper, but this gives you a sense of what the marginalĬost curve looks like. And then last but not least, when our total output is 70, And then, when our total output is 65, our marginal cost is 429, so the 65 is right over there and then 429 will get us right about, right about there, so you see our marginal cost is going up a lot now, it might be a little bit lower than that, so it's gonna be right over there. So 58 is right about there, and then it's gonna be 231, so it's about, right about there. And then when our total output is 58, our marginal cost is 231. So 45 is here and then 150 is right about there. And then, when our total output is 45, our marginal cost is $150. And we're just trying to get, be able to visualize what's going on. So, when our out put is 25,Ģ67 would be right about there. ![]() So let's see, when our total output is 25, our marginal cost is 267. It's one thing to watch me do it, but when you actually graph something you digest the numbers that much better. So, first let's just hand graph it, and I encourage you to go ![]() And so what we have on our vertical axis, this is our cost, and then down here, in our horizontal axis this is our output. Get from the calculations are interrelated, so let me scroll over a little bit so we have some space and then let me set up a That we just calculated, so that we can better appreciate how these various calculations and the curves that we can What we're going to do in this video is take this information,Įspecially total output and all of these things And then from that, we calculated things, like the marginal product of labor, the marginal cost, theĪverage variable cost, the average fixed cost,Īnd the average total cost. We tried to understand the economics of theīusiness based on some data that we had already collected on our costs and how much output we could produce based on how many labor units we had. ![]() Video, we began our study of ABC Watch Factory and ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |