relationship between marginal and average costs Consider the following scenario to understand the relationship between marginal and average values. Suppose Frances is a professional basketballplayer, and her game log for free throws can be summarized in the following table.Fill in the columns with Frances's free-throw percentage for each game and her overall free-throw average after each game.Game Game Result Total Game Free-Throw Percentage Average Free-Throw Percentage16/86/8757522/88/162/410/2048/1018/308/1026/40On the following graph, use the orange points (square symbol) to plot Frances's free-throw percentage for each game individually, and use the greenpoints (triangle symbol) to plot her overall average free-throw percentage after each game.Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically. Note: Plot your points in the order in which you would like them connected. Line segments will connect the points automatically.(?10090Game Free-Throw Percentage807060Average Free-Throw Percentage50302010GAMEYou can think of the result in any one game as being Frances's marginal free-throw percentage. Based on your previous answer, you can deduce thatwhen Frances's marginal free-throw percentage is above the average,average must beYou can now apply this analysis to production costs. For a U-shaped average total cost (ATC) curve, when the marginal cost curve is below the averagetotal cost curve, the average total cost must be. Also, when the marginal cost curve is above the average total cost curve, the averagetotal cost must beTherefore, the marginal cost curve intersects the average total cost curveFREE-THROW PERCENTAGE

The performance of Frances a skilled basketball player has been evaluated below using the concept of…

You can think of the result in any one game as being Frances's marginal free-throw percentage. Based on your previous answer, you can deduce that when Frances's marginal free-throw percentage is above the average, the average must be You can now apply this analysis to production costs. For a U-shaped average total cost (ATC) curve, when the marginal cost curve is below the average total cost curve, the average total cost must be total cost must be . Also, when the marginal cost curve is above the average total cost curve, the average Therefore, the marginal cost curve intersects the average total cost curve

You can think of the result in any one game as being Frances's marginal free-throw percentage. Based on your previous answer, you can deduce that when Frances's marginal free-throw percentage is above the average, the average must be You can now apply this analysis to production costs. For a U-shaped average total cost (ATC) curve, when the marginal cost curve is below the average total cost curve, the average total cost must be total cost must be . Also, when the marginal cost curve is above the average total cost curve, the average Therefore, the marginal cost curve intersects the average total cost curve

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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