'If output is assumed to be perfectly divisible' What does this line mean????
'If output is assumed to be perfectly divisible' What does this line mean???? fielat.on,shp between TC "C
main o' relationship between TC
V Marginal cost the addition to total cost _ when one
Of output IS produced ,SfC is calculated • •
2. When TC rises at a diminishing rate, MC dechnes_
3. When the rate oi increase in TC stops diminishing MC s
minimum point. i.e pornt E in 6.12,
4. When the rate of increase in total cost starts rising. the margr.'
cost is increasing.
Relationship between TVC and MC
We know, MC addition to I-VC when one more unit of output
produced. So, JVC can obtained as summation ef
produced to be perfectiv divisible. then tota:
under the MC L' T_VC
Tv•c and ec
As in the diagram, at OQ level of output. TVC is equal to tlu• shaded
6.7 SOLVED PRACTICALS
4 ucn 'TCn-TCn.
TFC = AFCxoutpu'
TC • AC«outcut