when marginal cost is rising, what will be AFC,MP,AVC,ATC,MP?
When marginal cost is rising:
- Average Fixed Cost (AFC) will be decreasing because the fixed costs are spread over a larger quantity of output.
- Marginal Product (MP) will depend on the specific production function and cannot be determined solely based on the information provided.
- Average Variable Cost (AVC) will be increasing because the variable costs are increasing with each additional unit of output.
- Average Total Cost (ATC) will depend on the relationship between AFC and AVC. If AFC is decreasing at a faster rate than AVC is increasing, then ATC will be decreasing. However, if AFC is decreasing at a slower rate than AVC is increasing, then ATC will be increasing.
- Marginal Product (MP) will depend on the specific production function and cannot be determined solely based on the information provided.
When marginal cost is rising, let's analyze the changes in the associated cost concepts:
1. Average Fixed Cost (AFC): AFC will decrease because it is a fixed cost divided by the quantity produced. As the quantity produced increases, the fixed cost gets spread over a larger quantity, leading to a decrease in AFC.
2. Marginal Product (MP): MP may not have a direct relationship with the change in marginal cost. It depends on the specific production function and may vary independently.
3. Average Variable Cost (AVC): AVC may increase or decrease depending on the magnitude of the change in marginal cost. If the increase in marginal cost is greater than the average variable cost, AVC will increase. Conversely, if the increase in marginal cost is smaller than the average variable cost, AVC will decrease.
4. Average Total Cost (ATC): ATC will increase because it is the sum of AFC and AVC. If marginal cost rises, it will contribute to an increase in ATC.
5. Marginal Cost (MC): As given in the question, when marginal cost is rising, MC will be higher at each level of production.
To calculate the values of AFC (Average Fixed Cost), MP (Marginal Product), AVC (Average Variable Cost), ATC (Average Total Cost), and MP (Marginal Cost), you need to have information about production quantities and costs.
Let's break down each term and explain how to calculate them:
1. Average Fixed Cost (AFC):
- AFC is the fixed cost per unit of output.
- To calculate AFC, divide the total fixed cost by the quantity produced.
- AFC = Total Fixed Cost / Quantity Produced
2. Marginal Product (MP):
- MP represents the additional output generated by producing one additional unit of input.
- To calculate MP, find the change in total product associated with the change in input units.
- MP = Change in Total Product / Change in Input Units
3. Average Variable Cost (AVC):
- AVC is the variable cost per unit of output.
- To calculate AVC, divide the total variable cost by the quantity produced.
- AVC = Total Variable Cost / Quantity Produced
4. Average Total Cost (ATC):
- ATC is the total cost per unit of output, including both fixed and variable costs.
- To calculate ATC, add AFC and AVC.
- ATC = AFC + AVC
5. Marginal Cost (MC):
- MC represents the additional cost of producing one additional unit of output.
- To calculate MC, find the change in total cost associated with the change in output quantity.
- MC = Change in Total Cost / Change in Output Quantity
Now, let's address the main question: When the marginal cost is rising.
When marginal cost is rising:
- AFC remains constant because fixed costs do not change with production levels.
- MP may decrease as marginal product diminishes due to increasing production.
- AVC may or may not rise, depending on the relationship between marginal cost and average variable cost.
- ATC may increase if marginal cost is greater than AVC.
- MC is greater than AVC and ATC.
Please note that the precise values of these costs will depend on the specific data provided, such as fixed costs, variable costs, quantity produced, and changes in costs or production levels.