Question

4. The average cost of producing q units of a good is the total cost of production C(q), divided by the total production q: AC(q) calculus by MC(g) = C"(a) = . Ca for q> 0 The marginal cost MC is given in terms of G dThe fired cost of production is C(0). Why is C(0) called the fized cost? What does it represent? a. b. If C(g) is continuous for q 2 0 and C(0)> 0, what is lim la q+0+ Where does the continuity assumption get used? 4(a) If this derivative vanishes, how are the marginal cost MC and the average cost AC related? c. Find the derivative of the average cost, in terms of C(q) and MC(g) = C'(q) and q. d. Find (d) C(g) expressed in terms of q, C(q) and derivatives of C(g). Simplify to the extent that you can.

Answer 1

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