Average total cost (ATC) is obtained by dividing total cost by the quantity produced. It represents the average cost per unit of output and includes both fixed and variable costs.
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Marginal Cost: Marginal cost refers to the additional cost incurred from producing one more unit of output.
Economies of Scale: Economies of scale occur when an increase in production leads to a decrease in average total cost due to factors like specialization or bulk purchasing discounts.
Diseconomies of Scale: Diseconomies of scale happen when an increase in production leads to an increase in average total cost due to factors like coordination difficulties or inefficiencies.