Mostly summarized from Gregory Mankiw’s Principles of Economics, 5th Ed.
PART 5 Firm Behavior and the Organization of Industry
Chapter 13 of 36 The Costs of Production
Section 14 of 22
…
Figure 4 - Conrad's Average Cost and Marginal Cost Curves
Marginal cost MC is the increase in total cost TC that occurs when producing an additional unit of output quantity Q.
MC always = ΔTC
Average total cost ATC is the cost of one unit of output, TC/Q
…
Figure 4 shows for Conrad's Coffee Shop
· Average Total Cost (ATC)
· Average Fixed Cost (AFC)
· Average Variable Cost (AVC)
· Marginal Cost (MC)
These curves are drawn by graphing the Table 2 data.
These cost curves show three features typical of many firms
· MC rises with the quantity of output
· ATC curve is U-shaped
· MC curve crosses the ATC curve at the minimum of ATC, on Table 2 $1.30 at quantity of 5 produced
… …
average cost and marginal cost
heikin hiyō to genkai hiyō
平均費用と限界費用

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