Question: A firm has a short run total cost function given by the equation TC=100+10q, where q is the quantity of output produced.

1. What is the fixed cost of the firm? What is the variable cost? What is the marginal
   cost (MC)? Explain.
2. Write the equations for the farmer's average total cost (ATC) and average variable cost
   (AVC), both as functions of Q.
3. Show the ATC, AVC, and MC on one graph. Explain what is happening to average

fixed costs as Q increases, and explain how this relates to what you see in your graph.

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