4. Various measures of costDouglas Fur is a small manufacturer of fake-fur boots in Denver. The following table shows the company’s total cost of production at various production quantities. Fill in the remaining cells of the following table.QuantityTotal CostMarginal CostFixed CostVariable CostAverage Variable CostAverage Total Cost(Pairs)(Dollars)(Dollars)(Dollars)(Dollars)(Dollars per pair)(Dollars per pair)1201209012101206022701204533151206543801209554751201556630120On the following graph, plot Douglas Fur's average total cost (ATC) curve using the green points (triangle symbol). Next, plot its average variable cost(AVC) curve using the purple points (diamond symbol). Finally, plot its marginal cost (MC) curve using the orange points (square symbol). (Hint: ForATC and AVC, plot the points on the integer; for example, the ATC of producing one pair of boots is $210, so you should start your ATC curve byplacing a green point at (1, 210). For MC, plot the points between the integers: For example, the MC of increasing production from zero to one pair ofboots is $90, so you should start your MC curve by placing an orange square at (0.5, 90).)Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically.240A210ATC180150AVC120MC9060301356.QUANTITY (Pairs of boots)COSTS (Dollars per pair)

Marginal cost = (change in total cost / change in quantity) Fixed cost is equal to the total cost at…

Fill in the remaining cells of the following table. Quantity Total Cost Marginal Cost Fixed Cost Variable Cost Average Variable Cost Average Total Cost (Pairs) (Dollars) (Dollars) (Dollars) (Dollars) (Dollars per pair) (Dollars per pair) 120 120 90 1. 210 120 60 2 270 120

Fill in the remaining cells of the following table. Quantity Total Cost Marginal Cost Fixed Cost Variable Cost Average Variable Cost Average Total Cost (Pairs) (Dollars) (Dollars) (Dollars) (Dollars) (Dollars per pair) (Dollars per pair) 120 120 90 1. 210 120 60 2 270 120

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

4. Various measures of cost

Douglas Fur is a small manufacturer of fake-fur boots in Denver. The following table shows the company’s total cost of production at various production quantities.

Fill in the remaining cells of the following table.
Quantity
Total Cost
Marginal Cost
Fixed Cost
Variable Cost
Average Variable Cost
Average Total Cost
(Pairs)
(Dollars)
(Dollars)
(Dollars)
(Dollars)
(Dollars per pair)
(Dollars per pair)
120
120
90
1
210
120
60
2
270
120
45
3
315
120
65
4
380
120
95
5
475
120
155
6
630
120
On the following graph, plot Douglas Fur's average total cost (ATC) curve using the green points (triangle symbol). Next, plot its average variable cost
(AVC) curve using the purple points (diamond symbol). Finally, plot its marginal cost (MC) curve using the orange points (square symbol). (Hint: For
ATC and AVC, plot the points on the integer; for example, the ATC of producing one pair of boots is $210, so you should start your ATC curve by
placing a green point at (1, 210). For MC, plot the points between the integers: For example, the MC of increasing production from zero to one pair of
boots is $90, so you should start your MC curve by placing an orange square at (0.5, 90).)
Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically.
240
A
210
ATC
180
150
AVC
120
MC
90
60
30
1
3
5
6.
QUANTITY (Pairs of boots)
COSTS (Dollars per pair)

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