Please help with the analysis in the attached and also the formulas/theories behind the concepts user.© BrainMass Inc. brainmass.com October 9, 2019, 4:17 pm ad1c9bdddf
See the attached file.
(a) Based on this information, will the graph of this firm's average and marginal cost function look like figure 8.1(e)?
TC(X) is quadratic function and MC is linear;
AC(X) = 10,000,000/X + 50 + X/16000, which is convex.
Therefore, Figure 8.4 shows the graph of the cost functions.
(b) The firm's AC function is:
AC(X) = 10,000,000/X + 50 + X/16000
Set AC = MC, or
10,000,000/X + 50 + X/16000 = 50 + ...
Average marginal cost function is applied and the details are presented in the solution.