The upcoming discussion will update you about the differences between explicit cost and implicit cost. When most people think of cost, they think only of the explicit cost — the actual payment by firms to labour, capital, and other factors of production. Whether these costs are fixed or variable, they are straightforward: they are the amounts that firms must pay [...]
In this article we will discuss about the long run cost of a firm, explained with the help of suitable diagrams. In the short run, the firm may change its quantity of output produced (q) by means of suitable changes in the quantities used of different variable factors, but it cannot change the quantities used of the fixed factors. The [...]
In this article we will discuss about:- 1. Total Fixed Cost, Total Variable Cost and Short Run Total Cost 2. TVC Curve of the Firm 3. Total Fixed Cost (TFC) Curve 4. Short Run Total Cost Curve of the Firm 5. Average Fixed Cost and Average Fixed Cost Curve 6. Average Variable Cost and the Average Variable Cost Curve and [...]