Question

For each cost function (given in dollars), find the cost, average cost, and marginal cost at a production level of 1000 units; the production level that will minimize the average cost; and the minimum average cost.

C(q) = 6,000 + 340q − 0.3q² + 0.0001q³

(a) the cost, average cost, and marginal cost at a production level of 1000 units

(b) the production level that will minimize the average cost (Round your answer to the nearest integer.)

(c) the minimum average cost (Round your answer to two decimal places.)

Answer 1

Note: since average cost = C(q)/q and marginal cost = C'(q). Using this we find average cost and marginal cost at q=1000. Details explained in the image.