Question

3. The relationship between marginal and average costs Consider the following scenario to understand the relationship between marginal and average values. Suppose Raphael is a professional basketbal player, and his game log for free throws can be summarized in the following tabl Fill in the columns with Raphael's free-throw percentage for each game and his overall free-throw average after each Game Game Result Total Game Free-Throw Percentage Average Free-Throw Percentage 80 8/10 4/10 2/8 2/4 6/8 80 12/20 14/28 16/32 22/40 On the following graph, use the orange points (square symbol) to plot Raphael's free-throw percentage for each game individually, and use the green points (triangle symbol) to plot his 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

Answer 1

Game	Result	Total	Game FT %	Average FT %
1	8/10	8/10	80	80
2	4/10	12/20	40	60
3	2/8	14/28	25	50
4	2/4	16/32	50	50
5	6/8	22/40	75	55

90 80 70 60 50 Average FT % 40 -Game FT% 30 20 10 0 0 4 Game

You can deduce that when Raphael's marginal free-throw percentage is above the average , the average must be increasing.

When the marginal cost curve is below the average total cost curve, the average total cost must be decreasing. Also, when the marginal cost curve is above the average total cost curve, the average total cost must be increasing. Therefore, the marginal cost curve intersects the average total cost curve at the minimum point.