Short- Run Costs
Short-run price function relates to the short-run production time period. The factors of production employed in the short-run are predetermined factors and variable factors. As price refers to the prices paid for using the factor input, thus the short-run cost comprises of only predetermined costs and variable costs.
a) Fixed Costs
Definition - It is also called as "overhead costs" or unavoidable contractual costs.
- It does not differ with the output.
- such as rent, insurance premium and the interest in loan.
b) Variable Costs
Definition - It is also known as "direct costs" or avoidable contractual costs.
- It gets affected directly with output.
Such as wages of labour, price of the raw materials and electricity prices.
Total and Unit Costs Measurement are given below
a) Total Fixed Cost (TFC)
b) Total Variable Cost (TVC)
c) Total Cost (TC) = TFC + TVC
d) Average Fixed Cost (AFC) or fixed cost per unit of output.
e) Average Variable Cost (AVC) or variable cost per unit of output.
f) Average Total Cost (ATC or AC) or the cost per unit of output.
g) Marginal Cost (MC) or the additional cost incurred in producing one additional unit of output.
Short-run Cost Schedule
Units of Output
( b + c )
( e + f )
Shapes of TC, TFC and TVC Curves
Shapes of Unit Cost Curves
Email based production cost homework help - production cost assignment help at TutorsGlobe
Are you searching economics tutor for help with Production Cost questions? Production Cost topic is not easier to learn without external help? We at www.tutorsglobe.com offer finest service of economics homework help and economics homework help. Live tutors are available for 24x7 hours helping students in their Production Cost related problems. We provide step by step Production Cost question's answers with 100% plagiarism free content. We prepare quality content and notes for Production Cost topic under economics theory and study material. These are avail for subscribed users and they can get advantages anytime.
Why TutorsGlobe for Production Cost homework help
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!