Total cost is obtain by?

Assessment: WAEC SSCE - Economics - 2015 (Objective) Subject: Economics

Question 1 Report

Total cost is obtain by?

Answer Details
Total cost is obtained by "adding up the total variable cost and total fixed cost." Total variable cost is the cost that varies with the level of output, such as the cost of raw materials, labor, and energy. Total fixed cost is the cost that remains constant regardless of the level of output, such as rent, insurance, and salaries. To calculate total cost, we add up the total variable cost and total fixed cost. This gives us the total cost of producing a given level of output. Calculating total cost by "adding up the marginal cost at each level" is not correct because marginal cost is the additional cost of producing one more unit of output, and summing up these costs does not give us the total cost of producing all units of output. Similarly, "dividing the total cost of output at each level" and "adding up the average variable cost at each level" are not correct methods for calculating total cost.

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