aeeounting LLA Retum to the above problem dealing with Ralph's eost eurve..; Now suppose Ralph's accountant approximates CSR(q) with an LLA: CSR(q) .. F + vq. Further

~uppose the aeeountant does this by setting v equal to the marginai eost at q = 10 and F so that the total eost at q = 10 equals CSR(lO).

Graph the LLA. What is its slope? What is its intercept? Over what range does this strike you as a reasonable approximation to the underIying short-run and longrun eost eurves? Is the intercept a fixed eost?

AppendixLO1