Unit 6 Assignment Behind The Supply Curve

Name 5. The accompanying table shows a boat manufacturers total cost of producing boats. Quantity of BoatsTotal Cost0 450,000 1 490,000 2 510,000 3 520,000 4 540,000 5 570,000 6 610,000 7 670,000 8 750,000 9 870,000 a. What is this manufacturers fixed cost Solution The manufacturers fixed cost is 450,000. Even when no output is produced, the manufacturer has a cost of 450,000. b. For each level of output, calculate the variable cost (VC). For each level of output except zero output, calculate the average variable cost (AVC), average total cost (ATC), and average fixed cost (AFC) Qty of boatsTotal CostMarginal CostFixed costVariable CostsAVCATCAFC0 450,000 - 450,000.00 - - - - 1 490,000 40,000.00 450,000.00 40,000.00 40,000 490,000 450,000 2 510,000 20,000.00 450,000.00 60,000.00 30,000 255,000 225,000 3 520,000 10,000.00 450,000.00 70,000.00 23,333 173,333 150,000 4 540,000 20,000.00 450,000.00 90,000.00 22,500 135,000 112,500 5 570,000 30,000.00 450,000.00 120,000.00 24,000 114,000 90,000 6 610,000 40,000.00 450,000.00 160,000.00 26,667 101,667 75,000 7 670,000 60,000.00 450,000.00 220,000.00 31,429 95,714 64,286 8 750,000 80,000.00 450,000.00 300,000.00 37,500 93,750 56,250 9 870,000 120,000.00 450,000.00 420,000.00 46,667 96,667 50,000 c. For each level of output, calculate this manufacturers marginal cost (MC) (For convenience, place the