Question

Complete the following Table: 

 

Hint:

In numerical tables, if Total Fixed Cost (TFC) is not given, we usually treat TC at unit 1 as equal to the MC of the first unit, which essentially means we are calculating Total Variable Cost (TVC).

Answer 1

Step 1: Understanding the Concept: 
Marginal Cost (MC) is the addition to the Total Cost (TC) when one more unit of output is produced. 
Total Cost can be found by summing up the Marginal Costs of all units produced, assuming Total Fixed Cost (TFC) is zero or identifying it as the sum of variable costs. 
Step 2: Key Formula or Approach: 
The formula relating TC and MC is: 
\[ TC_n = \sum_{i=1}^{n} MC_i \] 
Or, \( TC_n = TC_{n-1} + MC_n \). 
Step 3: Detailed Explanation: 
Calculating TC for each unit: 
- For Unit 1: \( TC = MC_1 = 30 \). 
- For Unit 2: \( TC = TC_1 + MC_2 = 30 + 25 = 55 \). 
- For Unit 3: \( TC = TC_2 + MC_3 = 55 + 20 = 75 \). 
- For Unit 4: \( TC = TC_3 + MC_4 = 75 + 10 = 85 \). 
Step 4: Final Answer: 
The completed table is: