Question: Figure 4.65 shows cost with q = 10,000 marked. (a) Find the average cost when the production level is 10,000 units and interpret it. (b)

Figure 4.65 shows cost with q = 10,000 marked.
(a) Find the average cost when the production level is 10,000 units and interpret it.
(b) Represent your answer to part (a) graphically.
(c) At approximately what production level is average cost minimized?

20,000 10,000 A XXX 10,000 Figure 4.65 A C(q) 9

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a The average cost of quantity q is given by the formula Cqq From the graph we see that C10000 16000 ... View full answer

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