4. The Costs of Production. Explain how fixed costs, variable costs, and the total costs affect...

4. The Costs of Production. Explain how fixed costs, variable costs, and the total costs affect people daily?

Expert Solution

Cost of production the cost which is arises while producing goods and services.fixed cost means a cost which does not vary according to the volume of production.variable cost means the cost which is vary according to the volume of production.

Total cost means sum total of fixed ,variable and semi variable cost.

These cost affect our day to day life.as fixed cost remain same hence it does not change according to the volume .it is like sunk cost .Decision taken by these type of cost can not be reverted .It have huge amount of cost.we can not control fixed cost.But when we are talking about variable cost then we can save these type of cost.We can avoid these type of cost.when we buy large volume of goods then cost per unit will go down and we gain profit.

Hence variable cost can be controlled by fixed cost cannot be controlled.we have to pay sunk cost for running a business.

Like if we are taking a decision for doing business then we must have to pay electricity expense whether we are producing any unit or not.

But if we want to curbe out variable cost then we can save it by producing mass level of production.

If we are taking room for residential purpose then the same concept is arise we have to pay rent either we are living or not living

Rahul Sunny answered 7 months ago

1-Explain total costs as the sum of total fixed and total variable costs. 2-Discuss the difference...

1-Explain total costs as the sum of total fixed and total variable costs. 2-Discuss the difference between short-run and long-run average total cost with examples.

Ball Bearings, Inc., faces costs of production as follows: QUANITY TOTAL FIXED COSTS (DOLLARS) TOTAL VARIABLE...

Ball Bearings, Inc., faces costs of production as follows: QUANITY TOTAL FIXED COSTS (DOLLARS) TOTAL VARIABLE COSTS (DOLLARS) 0 180 0 1 180 80 2 180 140 3 180 180 4 180 240 5 180 320 6 180 450 Complete the following table by calculating the company’s total cost, marginal cost, average fixed cost, average variable cost, and average total cost at each level of production. QUANITY TOTAL COST (DOLLARS) MARGINAL COST (DOLLARS) AVERAGE FIXED COST (DOLLARS) AVERAGE VARIABLE COST...

what is the difference between fixed costs and variable costs? explain the shape of the total...

what is the difference between fixed costs and variable costs? explain the shape of the total variable cost curve and explain why and how the total cost and total variable cost curves differ. answer with your own word ( 200 words )

No. of Products Total Variable Costs, $ Total Costs $ Average Fixed Cost $ Average Variable...

No. of Products Total Variable Costs, $ Total Costs $ Average Fixed Cost $ Average Variable Cost $ Average Total Cost $ Marginal Cost$ 0 0 1 12 2 20 3 24 4 27 5 40 6 65 7 98 Assume that the fixed cost is $80, calculate the above costs in the table and explain the difference between average total costs and marginal costs. In a graph illustrate the Average Total Cost and Marginal Cost Curves, explain their relationship....

From the following information on costs of production, calculate Total Fixed Cost, Total Variable Cost, Average...

From the following information on costs of production, calculate Total Fixed Cost, Total Variable Cost, Average Variable Cost, and Marginal Cost. I also need to graph the total cost curves as well as the average and marginal cost curves. TC = TFC + TVC so for Q=1 TC=30, assume TFC=20 so TVC=10 (20+10=30); continue with logic about FC, it is independent of output, so it would be an incremental 20 with each additional level of output, TVC for each Q...

Total sales revenue is $1000, total variable costs are $600 and total fixed costs are $1000....

Total sales revenue is $1000, total variable costs are $600 and total fixed costs are $1000. The price is $10 per unit. Compute the break-even volume in units (assume that the break-even point is in the relevant range). A) 166.7 units B) 250 units C) 280 units D) 2500 units Beta company allocates fixed overhead costs based on direct labor dollars, with an allocation rate of $5 per DL$. Beta sells 1000 units of product X per month at a...

The Annual Fixed Costs for a production unit are $2,000,000. Variable Costs are related to Production Quantity as: Variable Costs = $15 + $.006 × Production Quantity

The Annual Fixed Costs for a production unit are $2,000,000. Variable Costs are related to Production Quantity as: Variable Costs = $15 + $.006 × Production Quantity. The Total Annual Cost = Fixed Costs + Variable Costs × Production Quantity. If the price of 1 produced part is $150; a) Determine the Production Quantity that will minimize the Unit Cost of a produced part, and calculate the Annual Profit generated at this Production Quantity. b) Determine the Production Quantity that will maximize...

assume a company incurs 100,000 for total variable costs and 150000 for total fixed costs to...

assume a company incurs 100,000 for total variable costs and 150000 for total fixed costs to produce 10000 units. what would the total cost be to produce 12000 units?

No of units Fixed costs Total variable costs Total Costs Total Sales 0 15,000 0 15,000 ...

No of units Fixed costs Total variable costs Total Costs Total Sales 0 15,000 0 15,000 0 50 15,000 10,500 25,500 15,000 100 15,000 21,000 36,000 30,000 150 15,000 31,500 46,500 45,000 200 15,000 42,000 57,000 60,000 250 15,000 52,500 67,500 75,000 300 15,000 63,000 78,000 90,000 Create a CVP graph.

Jim runs a nursery. Identify the following costs he faces as fixed costs, average fixed costs, variable costs, average variable costs, total costs, average total costs, or marginal costs:

Jim runs a nursery. Identify the following costs he faces as fixed costs, average fixed costs, variable costs, average variable costs, total costs, average total costs, or marginal costs:a) The rent he pays on his greenhouse in the short runb) The rent he pays on his greenhouse in the long runc) the cost of soil, water, and seeds in the short rund) the per-unit cost of producing a nursery plant in the short rune) the opportunity cost of shutting the...

Question