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WAEC Economics 2010 Question 14

Question 14

Theory of Costs and Revenue

If TC, FC and VC represent total cost, fixed cost and variable cost respectively, which of the following is correct?

  1. A.TC = FC − VC
  2. B.FC = TC + VC
  3. C.TC > FC + VC
  4. D.TC = FC + VC
Show the answer and explanation

Answer: D (TC = FC + VC)

Explanation

Total cost is the sum of fixed cost and variable cost.