ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Take your total cost of production and subtract your variable costs multiplied by the number of units you produced. This will give you your total fixed cost.

Detailed explanation-2: -To calculate variable costs, multiply what it costs to make one unit of your product by the total number of products you’ve created. This formula looks like this: Total Variable Costs = Cost Per Unit x Total Number of Units.

Detailed explanation-3: -Total fixed cost (TFC) is that cost which does not change with a change in the level of output. Total variable cost (TVC) is that cost which changes as the level of output changes. Total cost (TC) is the sum of total fixed cost and total variable fixed cost.

Detailed explanation-4: -Variable Costs = Total Cost – Fixed Costs. Variable Costs = Total Cost of Materials + Total Cost of Labor. Variable Costs = Variable Cost Per Unit × Total Number of Units Produced. Average Variable Cost Per Unit = Total Variable Costs ÷ Output. Break-Even Point = Fixed Costs ÷ Contribution Margin.