This time your firm was only able to give you information about your total cost. That...

This time your firm was only able to give you information about your total cost. That information is given below: T C = 128 + 8Q + 2Q 2

(a) Find the marginal cost and the average cost.

(b) Calculate the optimal cost-minimizing quantity

Solutions

Expert Solution

(A) Marginal cost (MC) = dTC/dQ = 8 + 4Q

Average cost = TC/Q = 128/Q + 8 + 2Q

(B) At optimal point, MC = AC

8 + 4Q = 128/Q + 8 + 2Q

2Q = 128/Q implies Q = 8

Rahul Sunny answered 2 years ago

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