Output Total Fixed Total Variable Total Costs Marginal Average Average Average Costs Costs Costs Fixed Costs Variable Costs Total Costs 0 500 0 100 500 700 1,200 7.0 200 500 1,300 2.50 300 2,300 1.67 7.67 400 2,400 500 500 3,100 6.20 600 3,820 7.2 0.8 6.37 7.20 700 5,200 8.8 0.71 6.71 7.42 (30 marks) 1. Name an example of a fixed cost for a business. (4 marks) (a) What happens to Total Fixed Cost (TFC) as the quantity produced increases? (3 marks) (b) What happens to Average Fixed Cost (AFC) as the quantity produced increases? (3 marks) 2. Name an example of a variable cost for a business. (4 marks) (a) What happens to Total Variable Cost (TVC) as the quantity produced increases? (3 marks) (b) What happens to Average Variable Cost (A VC) as the quantity produced increases? (3 marks) (c) By how much does TVC increase with each additional quantity produced? Is it constant? Does it increase or decrease?(3 marks) 3. Define Marginal Cost (MC) in simple terms. (4 marks) What happens to MC as the quantity produced increases? Why do think that occurs? (3 marks) (30 marks)