Do you want BuboFlash to help you learning these things? Or do you want to add or correct something? Click here to log in or create user.



Tags
#cfa-level-1 #economics #microeconomics #reading-15-demand-and-supply-analysis-the-firm #section-3-analysis-of-revenue-costs-and-profit #study-session-4
Question
Average total cost (ATC)[...]
Answer
Total cost divided by quantity; (TC ÷ Q) or (AFC + AVC)

Tags
#cfa-level-1 #economics #microeconomics #reading-15-demand-and-supply-analysis-the-firm #section-3-analysis-of-revenue-costs-and-profit #study-session-4
Question
Average total cost (ATC)[...]
Answer
?

Tags
#cfa-level-1 #economics #microeconomics #reading-15-demand-and-supply-analysis-the-firm #section-3-analysis-of-revenue-costs-and-profit #study-session-4
Question
Average total cost (ATC)[...]
Answer
Total cost divided by quantity; (TC ÷ Q) or (AFC + AVC)
If you want to change selection, open original toplevel document below and click on "Move attachment"

Parent (intermediate) annotation

Open it
Average total cost (ATC)Total cost divided by quantity; (TC ÷ Q) or (AFC + AVC)

Original toplevel document

3. ANALYSIS OF REVENUE, COSTS, AND PROFITS
umber of time periods). For example, average revenue is calculated by dividing total revenue by the number of items sold. To calculate a marginal term, take the change in the total and divide by the change in the quantity number. <span>Exhibit 3 shows a summary of the terminology and formulas pertaining to profit maximization, where profit is defined as total revenue minus total economic costs. Note that the definition of profit is the economic version, which recognizes that the implicit opportunity costs of equity capital, in addition to explicit accounting costs, are economic costs. The first main category consists of terms pertaining to the revenue side of the profit equation: total revenue, average revenue, and marginal revenue. Cost terms follow with an overview of the different types of costs—total, average, and marginal. Exhibit 3. Summary of Profit, Revenue, and Cost Terms Term Calculation Profit (Economic) profit Total revenue minus total economic cost; (TR – TC) Revenue Total revenue (TR) Price times quantity (P × Q), or the sum of individual units sold times their respective prices; ∑(P i × Q i ) Average revenue (AR) Total revenue divided by quantity; (TR ÷ Q) Marginal revenue (MR) Change in total revenue divided by change in quantity; (∆TR ÷ ∆Q) Costs Total fixed cost (TFC) Sum of all fixed expenses; here defined to include all opportunity costs Total variable cost (TVC) Sum of all variable expenses, or per unit variable cost times quantity; (per unit VC × Q) Total costs (TC) Total fixed cost plus total variable cost; (TFC + TVC) Average fixed cost (AFC) Total fixed cost divided by quantity; (TFC ÷ Q) Average variable cost (AVC) Total variable cost divided by quantity; (TVC ÷ Q) Average total cost (ATC) Total cost divided by quantity; (TC ÷ Q) or (AFC + AVC) Marginal cost (MC) Change in total cost divided by change in quantity; (∆TC ÷ ∆Q) 3.1. Profit Maximization In free markets—and even in regulated market economies—profit maximization tends to promote economic welfare and a hig

Summary

statusnot learnedmeasured difficulty37% [default]last interval [days]               
repetition number in this series0memorised on               scheduled repetition               
scheduled repetition interval               last repetition or drill

Details

No repetitions


Discussion

Do you want to join discussion? Click here to log in or create user.