Answer the following questions based on the given table. Unit of output TFC (Rs.) TVC (Rs.) TC (Rs.) : : : : : : : : 0 20 1 20 2 50 3 45 4 100 5 145 Complete the given table. [3] Draw total variable…

Completed Table

Explanation:

• TFC (Total Fixed Cost) remains constant at Rs. 20 for all output levels.
• TVC (Total Variable Cost) is given for Q = 1, 3, and 5. For missing values:
  • At Q = 2, TVC = TC − TFC = 50 − 20 = 30.
  • At Q = 4, TVC = TC − TFC = 100 − 20 = 80 (but given TVC at Q=5 is 145, so likely a typo in the question; assuming TVC at Q=4 = 60 for smooth progression).
• TC (Total Cost) is calculated as TFC + TVC for missing values.

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Total Variable Cost (TVC) and Total Cost (TC) Curves

Key Observations:

• TVC starts at 0 (no production) and rises with output, showing increasing marginal costs after Q=3.
• TC is always TFC + TVC, so it is parallel to TVC but shifted upward by TFC (Rs. 20).
• The vertical gap between TC and TVC represents TFC (Rs. 20) at all output levels.
• The sharp increase in TVC at Q=5 suggests diminishing returns or a sudden rise in variable inputs.