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  • Example Cost

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    racewill
    14 views3 pages
    The document provides 4 examples of cost functions, including the total cost (TC), marginal cost (MC), and average cost (AC) functions. Each example gives the equations for TC, MC, and AC and graphs the relationships between quantity (q) and the costs. The examples demonstrate different potential shapes that cost curves can take, including linear, quadratic, and cubic functions of quantity.

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    The document provides 4 examples of cost functions, including the total cost (TC), marginal cost (MC), and average cost (AC) functions. Each example gives the equations for TC, MC, and AC and graphs the relationships between quantity (q) and the costs. The examples demonstrate different potential shapes that cost curves can take, including linear, quadratic, and cubic functions of quantity.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    14 views3 pages

    Example Cost

    Uploaded by

    racewill
    The document provides 4 examples of cost functions, including the total cost (TC), marginal cost (MC), and average cost (AC) functions. Each example gives the equations for TC, MC, and AC and graphs the relationships between quantity (q) and the costs. The examples demonstrate different potential shapes that cost curves can take, including linear, quadratic, and cubic functions of quantity.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 3

    Examples of cost function

    1) Total cost: T C(q) = 10 + 10q Marginal cost: M C(q) = Average cost: AC(q) =
    dT C(q) dq

    = 10
    10+q+q 2 q 10 q

    T C(q) q

    10 q

    + 10

    where AV C(q) = 10 and AF C(q) =

    14 12 10 8 6 4 2 0 2 4 6 8 10 q 12 14 16 18 20

    2) Total cost: T C(q) = 10 + q + q 2 Marginal cost: M C(q) = Average cost: AC(q) =


    dT C(q) dq

    = 1 + 2q
    10+q+q 2 q

    T C(q) q

    10 q

    +1+q

    where AV C(q) = 1 + q and AF C(q) = 1

    10 q

    14 12 10 8 6 4 2 0 2 4 6 q 8 10 12

    3) Total cost: T C(q) = 10 + 10q 4q 2 + q 3 C(q) Marginal cost: M C(q) = dTdq = 10 8q + 3q 2 Average cost: AC(q) =
    T C(q) q

    10+10q4q 2 +q 3 q

    =
    10 q

    10 q

    where AV C(q) = 10 4q + q 2 and AF C(q) = 14 12 10 8 6 4 2 0 1 2 q 2 3

    + 10 4q + q 2

    4) Total cost: T C(q) = 10 + 10q 2


    dT C(q) = 20q dq 2 Average cost: AC(q) = T C(q) = 10+10q q q where AV C(q) = 10q and AF C(q) = 10 q

    Marginal cost: M C(q) =

    10 q

    + 10q

    40

    30

    20

    10

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