Given the following cost functions: TC=100+60Q-3Q2+0.1Q3 TC=100+ 60Q+3Q2 TC=100 + 60Q Compute the average variable cost, average cost, and marginal cost for each function. Plot them on a graph.
Given the following cost functions: TC=100+60Q-3Q2+0.1Q3 TC=100+ 60Q+3Q2 TC=100 + 60Q Compute the average variable cost, average cost, and marginal cost for each function. Plot them on a graph.
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter7: Proudction Costs
Section: Chapter Questions
Problem 17SQ
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Given the following cost functions:
TC=100+60Q-3Q2+0.1Q3
TC=100+ 60Q+3Q2
TC=100 + 60Q
- Compute the average variable cost, average cost, and marginal cost for each function. Plot them on a graph.
- In each case, indicate the point at which diminishing returns occurs. Also, indicate the point of maximum cost efficiency (i.e., the point of minimum average cost).
- What is the relationship between marginal cost and average variable cost and between marginal cost and average cost? What is the relationship between average variable cost and average cost?
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