What happens to average total costs as a result of an increase in total fixed costs?

An increase in total fixed costs impacts average total costs because average total cost is calculated as the total cost (which includes both fixed and variable costs) divided by the quantity of output produced. When total fixed costs increase, the total cost also increases, but this effect is distributed over the output quantity.

If the increase in fixed costs does not coincide with a change in the quantity of output produced in the short run, the per-unit cost of producing each additional unit rises, leading to an increase in average total costs. This means that, as fixed costs make up a larger share of the total costs, it elevates the average total cost, assuming no change in variable costs or production levels.

Therefore, it is accurate to conclude that average total costs will rise as a direct result of an increase in total fixed costs.