Question

State the reason why Total Variable Cost (TVC) curve and Total Cost (TC) curve are parallel to each other.

Answer 1

Because of law of variable proportions is the reason why there is vertical parallel distance between Total variable cost and Total cost and you should note that total fixed cost will be remain constant at any cost.

When output is zero, Total variable costs will also be zero but you need to note that it will increase as the output increases and TVC curves is denoted by inverted-S Shape.