How do I calculate marginal cost from total variable cost and what condition will this be?

Md Ariful Islam

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Dr. Md Rushad Rahman

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Margin cost is calculated from total cost, which includes both fixed costs and variable costs. If you tried to calculate your marginal costs based solely on the change in variable costs, your results would be skewed and unreliable because they didn't include fixed costs.

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How do you find the total cost for one item from its unit cost?

The unit cost x quantity = total cost. For example: 24 oz soup at $0.10 ounce is 24 x $0.10 = $2.40.

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If a restaurant had total sales of $348,902, and food sales made up 80% of the total sales, and food cost was 29.34%, what was the cost of food?

Multiply the percentage of food sales (80%) by total sales ($348,902); then multiply the results by the food cost percentage (29.34%) to get the dollar cost of food. The answer...

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Chip’s Home Brew Whiskey management forecasts that if the firm sells each bottle of Snake-Bite for $20, then the demand for the product will be 15,000 bottles per year, whereas sales will be 90 percent as high if the price is raised 10 percent. Chip’s variable cost per bottle is $10, and the total fixed cash cost for the year is $100,000. Depreciation and amortization charges are $20,000, and the firm has a 30 percent marginal tax rate. Management anticipates an increased working capital need of $3,000 for the year. What will be the effect of the price increase on the firm’s FCF for the year?

All other factors being equal, raising the price to $22 at 90% of the volume at $20 per bottle, increases profit before tax by $12,000, or $8400 after taxes. By...

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How do I calculate marginal cost when I want to maximize profit?

Your calculation remains the same. To find the marginal cost, you would divide the total change in cost by the total change in quantity. Do this for several intervals, and...

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What's the difference between marginal cost and marginal revenue?

Marginal cost is the additional costs incurred when you produce one additional unit of your product. Marginal revenue is the additional revenue you'll receive when you produce that additional unit....

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How do I calculate both fixed and variable cost while given the total cost and what they produced?

To calculate fixed and variable costs, you will need more information than just the total cost and quantity produced. You will need to know either fixed costs or variable costs...

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How do I calculate total costs and total revenue?

Total cost is fixed cost plus variable cost, while total revenue is the sum of the marginal revenues for each unit.

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Can marginal cost go up?

Yes, marginal cost can increase as it exhibits economies of scale.

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Why does the fixed cost increase and the variable cost remains the same? It should be the opposite.

Total fixed costs should remain the same. The fixed cost per unit will vary according to how many units are produced. For example, if fixed costs were $4000, and 400...

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How do I find marginal total cost?

Total cost B - Total cost A / the difference in output produced. This is used to determine the increase in total cost contributed by an increase in total output...

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