A simple production function # Inputs # Outputs 1 12 2 36 3 60 4 72 5 80 6 84
MP = marginal product (=Δoutput/Δinput) # Inputs # Outputs MP - 1 12 2 36 3 60 4 72 5 80 6 84
MP = marginal product (=Δoutput/Δinput) # Inputs # Outputs MP - 1 12 2 36 3 60 4 72 5 80 6 84
MP = marginal product (=Δoutput/Δinput) # Inputs # Outputs MP - 1 12 2 36 24 3 60 4 72 5 80 6 84
MP = marginal product (=Δoutput/Δinput) # Inputs # Outputs MP - 1 12 2 36 24 3 60 4 72 5 80 6 84
MP = marginal product (=Δoutput/Δinput) # Inputs # Outputs MP - 1 12 2 36 24 3 60 4 72 5 80 6 84
MP = marginal product (=Δoutput/Δinput) # Inputs # Outputs MP - 1 12 2 36 24 3 60 4 72 5 80 8 6 84
AP = average product (outputs/inputs) MP AP - 1 12 2 36 24 3 60 4 72 5 80 8 6 84
AP = average product (outputs/inputs) MP AP 1 12 2 36 24 3 60 4 72 5 80 8 6 84
AP = average product (outputs/inputs) MP AP 1 12 2 36 24 18 3 60 4 72 5 80 8 6 84
AP = average product #I #O MP AP 1 12 2 36 24 18 3 60 20 4 72 5 80 8 6 1 12 2 36 24 18 3 60 20 4 72 5 80 8 6 84
AP = average product #I #O MP AP 1 12 2 36 24 18 3 60 20 4 72 5 80 8 6 1 12 2 36 24 18 3 60 20 4 72 5 80 8 6 84
AP = average product #I #O MP AP 1 12 2 36 24 18 3 60 20 4 72 5 80 8 1 12 2 36 24 18 3 60 20 4 72 5 80 8 16 6 84
Now: Think in terms of costs MP AP 1 12 2 36 24 18 3 60 20 4 72 5 80 8 16 6 84 13
FC = fixed cost #I #O MP AP FC 1 12 2 36 24 18 3 60 20 4 72 5 80 8 16 160 1 12 2 36 24 18 3 60 20 4 72 5 80 8 16 6 84 13
FC = fixed cost #I #O MP AP FC 1 12 2 36 24 18 3 60 20 4 72 5 80 8 16 160 1 12 2 36 24 18 3 60 20 4 72 5 80 8 16 6 84 13
VC = variable cost (= #inputs x PINPUTS) MP AP FC VC 160 - 1 12 2 36 24 18 3 60 20 4 72 5 80 8 16 6 84 13
VC = variable cost #I #O MP AP FC VC 1 12 2 36 24 18 3 60 20 4 72 5 8 160 - 1 12 80 2 36 24 18 3 60 20 4 72 5 8 16 6 84 13
VC = variable cost #I #O MP AP FC VC 1 12 2 36 24 18 3 60 20 4 72 5 8 160 - 1 12 80 2 36 24 18 3 60 20 4 72 5 8 16 6 84 13
VC = variable cost #I #O MP AP FC VC 1 12 2 36 24 18 3 60 20 4 72 5 8 160 - 1 12 80 2 36 24 18 3 60 20 240 4 72 5 8 16 6 84 13
TC = total cost (= FC + VC) #I #O MP AP FC VC TC 160 - 1 12 80 2 36 24 18 3 60 20 240 4 72 320 5 8 16 400 6 84 13 480
TC = total cost (= FC + VC) #I #O MP AP FC VC TC 160 - 1 12 80 240 2 36 24 18 3 60 20 4 72 320 5 8 16 400 6 84 13 480
TC = total cost (= FC + VC) #I #O MP AP FC VC TC 160 - 1 12 80 240 2 36 24 18 320 3 60 20 4 72 5 8 16 400 6 84 13 480
MC = marginal cost (= ΔTC/ΔQ = ΔVC/ΔQ) MP AP FC VC TC MC 160 - 1 12 80 240 2 36 24 18 320 3 60 20 400 4 72 480 5 8 16 560 6 84 13 640
MC = marginal cost (= ΔTC/ΔQ = ΔVC/ΔQ) MP AP FC VC TC MC 160 - 1 12 80 240 6.6 2 36 24 18 320 3 60 20 400 4 72 480 5 8 16 560 6 84 13 640
MC = marginal cost (= ΔTC/ΔQ = ΔVC/ΔQ) MP AP FC VC TC MC 160 - 1 12 80 240 6.6 2 36 24 18 320 3.3 3 60 20 400 4 72 480 5 8 16 560 6 84 13 640
MC = marginal cost (= ΔTC/ΔQ = ΔVC/ΔQ) MP AP FC VC TC MC 160 - 1 12 80 240 6.6 2 36 24 18 320 3.3 3 60 20 400 4 72 480 5 8 16 560 6 84 13 640
MC = marginal cost (= ΔTC/ΔQ = ΔVC/ΔQ) MP AP FC VC TC MC 160 - 1 12 80 240 6.6 2 36 24 18 320 3.3 3 60 20 400 4 72 480 5 8 16 560 6 84 13 640
MC = marginal cost (= ΔTC/ΔQ = ΔVC/ΔQ) MP AP FC VC TC MC 160 - 1 12 80 240 6.6 2 36 24 18 320 3.3 3 60 20 400 4 72 480 5 8 16 560 10 6 84 13 640
AFC = average fixed cost (=FC/Q) MP AP FC VC TC MC AFC 160 - 1 12 80 240 6.6 13.3 2 36 24 18 320 3.3 3 60 20 400 4 72 480 5 8 16 560 10 6 84 13 640
AFC = average fixed cost (=FC/Q) MP AP FC VC TC MC AFC 160 - 1 12 80 240 6.6 13.3 2 36 24 18 320 3.3 4.44 3 60 20 400 4 72 480 5 8 16 560 10 6 84 13 640
AFC = average fixed cost (=FC/Q) MP AP FC VC TC MC AFC 160 - 1 12 80 240 6.6 13.3 2 36 24 18 320 3.3 4.44 3 60 20 400 2.66 4 72 480 5 8 16 560 10 6 84 13 640
AVC = average variable cost (VC/Q) MP AP FC VC TC MC AFC AVC 160 - 1 12 80 240 6.6 13.3 2 36 24 18 320 3.3 4.44 3 60 20 400 2.66 4 72 480 2.22 5 8 16 560 10 2.00 6 84 13 640 1.90
AVC = average variable cost (VC/Q) MP AP FC VC TC MC AFC AVC 160 - 1 12 80 240 6.6 13.3 6.66 2 36 24 18 320 3.3 4.44 3 60 20 400 2.66 4 72 480 2.22 5 8 16 560 10 2.00 6 84 13 640 1.90
AVC = average variable cost (VC/Q) MP AP FC VC TC MC AFC AVC 160 - 1 12 80 240 6.6 13.3 6.66 2 36 24 18 320 3.3 4.44 3 60 20 400 2.66 4 72 480 2.22 5 8 16 560 10 2.00 6 84 13 640 1.90
AVC = average variable cost (VC/Q) MP AP FC VC TC MC AFC AVC 160 - 1 12 80 240 6.6 13.3 6.66 2 36 24 18 320 3.3 4.44 3 60 20 400 2.66 4 72 480 2.22 5 8 16 560 10 2.00 6 84 13 640 1.90
AVC = average variable cost (VC/Q) MP AP FC VC TC MC AFC AVC 160 - 1 12 80 240 6.6 13.3 6.66 2 36 24 18 320 3.3 4.44 3 60 20 400 2.66 4 72 480 2.22 4.4 5 8 16 560 10 2.00 6 84 13 640 1.90
AVC = average variable cost (VC/Q) MP AP FC VC TC MC AFC AVC 160 - 1 12 80 240 6.6 13.3 6.66 2 36 24 18 320 3.3 4.44 3 60 20 400 2.66 4 72 480 2.22 4.4 5 8 16 560 10 2.00 6 84 13 640 1.90
ATC = average total cost (=AVC+AFC) #I #O MP AP FC VC TC MC AFC AVC ATC 160 - 1 12 80 240 6.6 13.3 6.66 20 2 36 24 18 320 3.3 4.44 3 60 400 2.66 4 72 480 2.22 4.4 5 8 16 560 10 2.00 6 84 13 640 1.90 5.7
ATC = average total cost (=AVC+AFC) #I #O MP AP FC VC TC MC AFC AVC ATC 160 - 1 12 80 240 6.6 13.3 6.66 20 2 36 24 18 320 3.3 4.44 8.9 3 60 400 2.66 4 72 480 2.22 4.4 5 8 16 560 10 2.00 7 6 84 13 640 1.90 5.7 7.6