Question
In the table below, the production quantities and total production costs at various production quantities are shown. For example, fixed costs are IDR 10 thousand.
In the table below, the production quantities and total production costs at various production quantities are shown. For example, fixed costs are IDR 10 thousand.
Production Quantity (Units) | Price (Thousand Rupiah) | Total Cost (thousand rupiah) |
1 2 3 4 5 6 7 8 | 20 18 16 14 12 10 8 6 | 21 31 39 45 49 55 70 100 |
Calculate:
Average cost (AC)
Average fixed cost (AFC)
Average changing cost (AVC)
Marginal cost (MC)
Draw the AC, AFC, AVC, and MC curves
Using the MC = MR approach, determine the level of production that maximizes profits and describe the equilibrium state achieved
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Introduction to Operations Research
Authors: Frederick S. Hillier, Gerald J. Lieberman
10th edition
978-0072535105, 72535105, 978-1259162985
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