Economics - Microeconomics - Production and costs - Costs of Production

A 6-step reveal of cost concepts. Step 1: 'Fixed Costs (FC)' - Don't change with output: rent, insurance, machinery. Even if you produce zero, you pay these. Step 2: 'Variable Costs (VC)' - Change with output: raw materials, wages, electricity. More production = higher VC. Step 3: 'Total Cost' - TC