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Question
If total cost = 10+Q3, find out AC, AVC, TFC, AFC when Q=5.
Solution
TC = 10 + Q3
AC = `"TC"/"Q"`
AC = `(10+ "Q"^3)/"Q"`
If Q = 5 x 5 x 5 = 125
AC = `(10+125)/5` = `135/5` = 27
AVC:
TC = 10 + Q3
TC = TFC + TVC
TVC = Q3
AVC = `"TVC"/"Q"`
= `"Q"^3/"Q"`
If Q = 5, then AVC = 52
AVC = 25
TFC:
TC = 10 + Q3
TC = TFC + TVC
TFC = 10
AFC:
AFC = `"TFC"/"Q"`
= `10/5`
AFC = 2
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