Question

a)     Determine the Fixed Cost, Average Variable cost, and Marginal cost functions for a firm whose total cost function is defined by

 

C = 36x-10x^2+2x^3 

Answer 1

$Marginalcost(x)=c'(x)=VC'(x)=(36x-10x^2+2x^3)'=36-20x+6x^2$

TC=FC+VC

$TC=36x-10x^2+2x^3$

FC=lim+C(x)

x→0

FC=0

$AVC=\frac{VC}{Q}$

Q=x

$AVC=\frac{VC}{Q}=\frac{36x-10x^2+2x^3}{x}=36-10x+2x^2$