Question

4. Various measures of cost Douglas Fur is a small manufacturer of fake-fur boots in New York City. 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 Total Cost Marginal Cost Fixed Cost Variable Cost Average Variable Cost Average Total Cost (Pairs) (Dollars) (Dollars) (Dollars) (Dollars) (Dollars per pair) (Dollars per pair) 0 60 — — 1 160 2 220 3 270 4 340 5 450 6 630 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

Output	TFC	TVC	TC	AVC	ATC	MC
0	60	0	60
1	60	100	160	100	160	100
2	60	160	220	80	110	60
3	60	210	270	70	90	50
4	60	280	340	70	85	70
5	60	390	450	78	90	110
6	60	570	630	95	105	180