how can you calculate average cost
You add up all the numbers that you're averaging and then divide that number by the amount of numbers you're averaging.
Here's an example.....
100, 99, 67, 81
add them all up...
347
now divide that number by four because there are four numbers (110, 99, 67, 81)
the average of the numbers is... 86.75
Average Variable Cost = Total Variable Cost/ Quantity Average Cost = Average Fixed Cost + Average Variable Cost Average Cost = Total Cost/Quantity
Average cost = Total cost / number of units of a good produced. So Total cost = Average cost X No. of units of a good produced
When average total cost curve is falling it is necessarily above the marginal cost curve. If the average total cost curve is rising, it is necessarily below the marginal cost curve.
as a marginal cost is the cost of the next product produced, if this is less than average cost, when you continue to produce more products the lower marginal cost will have an affect on the average and cause it to fall.
Average total cost is the average of all your costs. This is your Fixed Costs and your Variable costs. Average Variable Cost is the average of your costs that can fluctuate.
Average Variable Cost = Total Variable Cost/ Quantity Average Cost = Average Fixed Cost + Average Variable Cost Average Cost = Total Cost/Quantity
Average cost = Total cost / number of units of a good produced. So Total cost = Average cost X No. of units of a good produced
Average total cost is the average of all your costs. This is your Fixed Costs and your Variable costs. Average Variable Cost is the average of your costs that can fluctuate.
return is calculate against investment. profit is calculte against cost.
When average total cost curve is falling it is necessarily above the marginal cost curve. If the average total cost curve is rising, it is necessarily below the marginal cost curve.
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Average Cost Method: Under this method average cost is calculated by following farmula:Average cost of unit= Total cost of inventory / total number of units
Margianal cost curve crosses the average total cost curve at the lowest point on the average total cost curve to be socially and ecomonical efficient.
as a marginal cost is the cost of the next product produced, if this is less than average cost, when you continue to produce more products the lower marginal cost will have an affect on the average and cause it to fall.
Average total cost is the sum of all the production costs divided by the number of units produced.
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Average total cost is the average of all your costs. This is your Fixed Costs and your Variable costs. Average Variable Cost is the average of your costs that can fluctuate.