Question

1-A producer sells more of units at lower price then additional revenue will be.
2-What happens to the difference between TC and TVC as output is increased.​

Answer 1

2) The difference between TC and TVC will always be constant because TC-TVC=TFC which is constant at any level of output.

sorry mate... ionly know the 2 question...

Answer 2

In the first case,the additional revenue will decrease if the producer reduce the price of additional unit.

In the second case,the difference between Total Cost(TC) and Total Variable Cost(TVC) will remain constant as output is expanded by the producer.

Explanation:

In the first case,additional revenue refers to the marginal revenue in Microeconomics.It means the incremental or additional revenue earned by the producer as it sells 1 more unit of output to the consumer.Hence,the producer is essentially obtaining price of 1 more unit of output as the marginal or additional revenue.Therefore,if the price is reduced increasingly,the additional revenue or marginal revenue for the producer will also decline accordingly.

Secondly,as the output or production will increase the TVC will consequently change as the producer will employ more of the variable inputs in the production process to alter the output level.Thus TVC will supposedly increase with increase in production.This will also proportionately increase the TC.Since TC=Total Fixed Cost(TFC) + TVC and TFC is fixed and does not change with the variation in output level,TC will increase in the same level/proportion as the TVC and the difference between TC and TVC will not change or remain constant.