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    calculate all cost curves

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    Cost Data (Excel application)

    TC = 20 + 4Q

    TC = 20 + 2Q + 0.5Q2

    TC = 20 + 4Q - 0.1Q2

    Using Excel, calculate all cost curves using a range of quantity from 0 to 15.
    Total cost
    Total fixed Cost
    Total variable cost
    Average total cost
    Average fixed cost
    Average variable cost
    Marginal cost

    Plot these curves on graphs
    Compare the cost curves and discuss their characteristics.

    Solution Guide

    To calculate the average and marginal costs, use the following formulas:
    ATC = TC÷Q
    AFC = TFC÷Q
    AVC = TVC÷Q
    MC = change in TC ÷ change in Q

    Using the numbers in the tables, plot the different cost curves using Excel graphing features.
    The cost numbers are plotted on the vertical axis (y).
    The quantity numbers are plotted on the horizontal axis (x).

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