A rational firm operating in a perfectly competitive market has its demand and total cost function given below. P=20-30Q TC=50+25Q-40Q2 Required Average fixed cost function Average variable cost function

A rational firm operating in a perfectly competitive market has its demand and total cost function given below. P=20-30Q TC=50+25Q-40Q2 Required Average fixed cost function Average variable cost function

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter7: Proudction Costs

Section: Chapter Questions

Problem 5SQP

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Concept explainers

Short-Run Costs and Long-Run Costs

Cost of short-run and the long-run is an economic term that describes the cost involved in the production of goods in a firm in the short as well as long period.

Question

A rational firm operating in a perfectly competitive market has its demand and total cost function given below.

P=20-30Q

TC=50+25Q-40Q²

Required

Average fixed cost function
Average variable cost function

Definition Definition Structure of the market that exists when many buyers and sellers exchange similar commodities and prices are fixed by market forces, demand, and supply. When there is perfect competition, a single business cannot impact the price or market value of the homogenous product.

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