Calculator
Total Cost Calculator (from total)
Total Cost Calculator (from average)
Definition – What is total cost?
Total cost in microeconomics is the total of all costs to the firm.
Total cost includes fixed costs (costs that occur regardless of the quantity produced) and variable costs (cost incurred with each item produced). It also calculates by multiplying the average cost per unit by the number of units produced.
Formula – How to calculate Total Cost
From Total: Total Cost = Total Fixed Costs + Total Variable Costs
From Average: Total Cost = Average Cost x Quantity
Example
Total Cost (from Total): total fixed costs are $200,000 and total variable costs are $300,000.
Total Cost = $200,000 + $300,000 = $500,000
Total Cost (from Average): average cost is $35 per unit and 400 units are produced.
Total Cost (from Average) = $35 x 400 = $14,000
Sources and more resources
- Wikipedia – Total Cost – Wikipedia’s entry on total cost. It breaks down different ways that cost is calculated.