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3. Suppose that the cost function of q is given by: C (q) = 16 +...

3. Suppose that the cost function of q is given by: C (q) = 16 + 4q + q^2

(a) Find the fixed and variable cost.

(b) Find the average cost and marginal cost. 1

(c) Draw the relationship between MC and AC. Prove that they always intersect at the minimum. (Hint: compute the derivative of AC with respect to q and set it equal to zero. Then use this equation to show that MC=AC)

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