Economics Cost Of Production Questions
The different types of costs involved in production are:
1. Fixed costs: These are costs that do not vary with the level of production, such as rent, salaries, and insurance.
2. Variable costs: These costs change in direct proportion to the level of production, such as raw materials, labor, and utilities.
3. Total costs: This is the sum of fixed costs and variable costs, representing the overall cost of production at a given level.
4. Average costs: This is the total cost divided by the quantity produced, indicating the average cost per unit.
5. Marginal costs: This is the additional cost incurred by producing one more unit of output, calculated by the change in total cost divided by the change in quantity produced.