Worker Quantity/total Marginal Average Fixed Variable Total Avg Fixed Avg variable Ave total Marginal

product product Product cost cost cost Cost cost cost cost
0 0
1 20
2 50
3 90
4 120
5 140
6 150
7 155

a) Fill in the column of marginal products. What pattern do you see? How might you explain it?
b) A worker costs $100 a day, and the firm has fixed costs of $200. Use this information to fill in the column for total cost.
c) Fill in the column for average total cost. What pattern do you see?
d) Now fill in the column for marginal cost. What pattern do you see?
e) Compare the column for marginal product and the column for marginal cost. Explain the relationship.

Marginal Product Marginal cost

f) Compare the column for average total cost and the column for average product. Explain the relationship.

Average Product Average total cost

g) Compare the column for average total cost and the column for marginal cost. Explain the relationship.

Marginal cost Average total cost

Q TC FC VC AFC AVC ATC MC TR MR π
0 10
1 20
2 28
3 35
4 43
5 53
6 65
7 80
8 100
9 125
10 155

1. Fill the above table by missing values.

2. Highlight the stages of production using cost analysis.
3. What is the inflection point output in above table?
4. At which point AP and MP will be equal and does it advocate maximum level of AP?
5. Calculate the profit maximizing output level, when price of output is 15.
TP TC Price FC VC AVC ATC MC TR MR Profit
0 10 100
1 20 90
2 28 80
3 35 70
4 43 60
5 53 50
6 65 40
7 80 30
8 100 20
9 125 10
10 155 0

1. Fill the above table by missing values.

2. Highlight the stages of production using cost analysis.
3. What is the inflection point output in above table?
4. At which point AP and MP will be equal and does it advocate maximum level of AP?
5. Calculate the profit maximizing output level, using MC=MR rule.