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Example Cost

The document provides examples of total cost, marginal cost, and average cost functions including their equations and graphs. It gives four examples of different cost functions including linear, quadratic, and cubic specifications.

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Harry Zhan
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34 views

Example Cost

The document provides examples of total cost, marginal cost, and average cost functions including their equations and graphs. It gives four examples of different cost functions including linear, quadratic, and cubic specifications.

Uploaded by

Harry Zhan
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Examples of cost function

1) Total cost: T C(q) = 10 + 10q


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

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


q

14

12

10

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

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


dT C(q)
Marginal cost: M C(q) = dq = 1 + 2q
T C(q) 10+q+q 2
Average cost: AC(q) = q = q = 10
q +1+q

where AV C(q) = 1 + q and AF C(q) = 10


q

1
14

12

10

0 2 4 q6 8 10 12

3) Total cost: T C(q) = 10 + 10q − 4q 2 + q 3


Marginal cost: M C(q) = dTdqC(q)
= 10 − 8q + 3q 2
T C(q) 10+10q−4q 2 +q 3
Average cost: AC(q) = q = q = 10
q + 10 − 4q + q 2
where AV C(q) = 10 − 4q + q 2 and AF C(q) = 10
q

14

12

10

0 1 2 3 4 5
q

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

40

30

20

10

0 1 2 3 4 5
q

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