Total Revenue - The total amount of money a firm receives from selling goods and services. PxQ = TR
Fixed Cost - a cost that does not change no matter how much of a good is produced. Ex: Mortgage, rent, salary
Variable Cost - a cost that rises or falls depending upon how much is produced. Ex: electricity depends upon usage
Marginal Cost - the cost of producing one more unit of a good.
Formulas:
TFC + TVC = TC
AFC + AVC = ATC
TFC/Q= AFC
TVC/Q=AVC
TC/Q= ATC
AFC x Q= TFC
AVC x Q= TVC
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