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  Total cost

Total cost:

Total cost is the summation of total variable cost and total fixed cost.

TC = TFC + TVC

Here,

TC = Total cost
TC = Total Fixed cost
TVC = Total variable cost

It must be observed that total fixed cost is similar irrespective of the level of output. Thus a change in total cost is influenced by the change in variable cost simply. The relationship among total fixed cost, total variable cost and total cost will be apparent from the figure shown below:

1392_total costs.jpg

 

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