Total Cost
Plain definition
The sum of all costs of production: fixed costs plus variable costs (TC = FC + VC).
In economics
Total cost is the full dollar outlay of producing a given quantity. Dividing by quantity gives average total cost (ATC = TC ÷ Q), and the change in TC from producing one more unit is marginal cost. Profit-maximizing firms compare total revenue with total cost to compute profit.
Example
If rent is 6,000 (variable), the total cost of the month's output is $10,000.
Common confusion
Total cost is often confused with marginal cost. Total cost answers 'what did all production cost?'; marginal cost answers 'what does one more unit cost?' The MC curve's shape comes from the slope of the TC curve, not from TC itself.