Image: Â© Briangotts. Satellite view is showing Valletta, the capital city of Malta. Valletta is located in the central-eastern portion of the island of Malta at the Mediterranean coast.The city is colloquially known as Il-Belt (The City) in Maltese and is the island's principal cultural center.mage: Â© Briangotts. Satellite view is showing Valletta, the capital city of Malta. Valletta is located in the central-eastern portion of the island of Malta at the Mediterranean coast.
Subtract the average variable cost from the average total cost. The answer will be the average fixed cost. In the example, the average variable cost of $1.50 per unit would be subtracted from the average total cost of $3.50 per unit in order to reach an average fixed cost amount of $2 per unit. Note that this matches the average fixed cost calculated in method 1.
When compared with price (per unit revenue), average total cost (ATC) indicates the per unit profitability of a profit-maximizing firm. Average total cost is one of three average cost concepts important to short-run production analysis. Third, the average total cost values in this table are comprised of two parts--average variable cost and average fixed cost. 2  In other words, the $4.60 average total cost of producing 10 Stuffed Amigos can be broken down into something like $4.30 of average variable cost and $0.30 of average fixed cost.