Production and Cost CHAPTER12

The average total cost curve for transactions with a human teller is ATCT.

The ATM and the Cost of Getting Cash

The average total cost curve for transactions with an ATM is ATCA.

The lowest average total cost for a human teller transaction is $1.07.

The lowest average total cost curve for an ATM transaction is 27 cents.

The long-run average cost curve is LRAC. At Q transactions per month, both methods have the same average total cost.

For a credit union that does fewer than Q transactions per month, its least-cost method is the teller.

For a bank that does more than Q transactions per month, the least-cost method is the ATM.

The ATM and the Cost of Getting Cash

More technology and more capital is not always efficient.

The ATM and the Cost of Getting Cash