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Average Total Cost (ATC)

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Suppose the long-run costs for ABC, Inc is represented by the following function:
TC = 28,400,300 + 460,200Q, where C is total cost in dollars and Q is the number of products. (Show work)

A. If Q = 500, what is average total cost?

B. What is the marginal cost?

C. If Q = 200, what is the average total cost?

D. If the entire market is 1,000 prodcuts and if all firms have the same function, would a firm with a 50% market share have an advantage over a firm with a 20% market share?

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Solution Preview

Suppose the long-run costs for ABC, Inc is represented by the following function:
TC = 28,400,300 + 460,200Q, where C is total cost in dollars and Q is the number of products. (Show work)

A. If Q = 500, what is average total cost?

B. What is the marginal cost?

C. If Q = ...

Solution Summary

Average Total Cost (ATC) is featured.

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