Question Details

GENERAL ECONOMICS ASSIGNMENT - COST CURVES

17. Say that a firm has fixed costs of$100 and constant average variable cost of $25.00.
A. Graph ATC, AFC, and MC curves
B. Explain why the curves have the shape they do
C. What law is not opperative for this firm?
D. Say that instead of remaining a constant of $25.00 , average variable cost increases by $5.00 for each unit, so that the cost of 1 is $25.00, the cost of 2 is $30,00, the cost of 3 is $35.00 etc... Graph the AFC, ATC, and MC curves e. Explain how costs would have to increase in "d" in order for the curves to have the normal shapes?
 
Calculations attached.