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Total Cost Function Examples

The document provides 4 examples of cost functions, each with the total cost, marginal cost, and average cost formulas. The total cost functions include linear, quadratic, cubic, and exponential forms. Accompanying each total cost function are the derivations of the marginal cost and average cost formulas. Graphs are also shown for some of the cost functions.

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Ram Kumar
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86 views3 pages

Total Cost Function Examples

The document provides 4 examples of cost functions, each with the total cost, marginal cost, and average cost formulas. The total cost functions include linear, quadratic, cubic, and exponential forms. Accompanying each total cost function are the derivations of the marginal cost and average cost formulas. Graphs are also shown for some of the cost functions.

Uploaded by

Ram Kumar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Examples of cost function

1) Total cost: T C(q) = 10 + 10q


dT C(q)
Marginal cost: M C(q) = dq = 10
T C(q) 10+q+q 2
Average cost: AC(q) = q = q = 10
q + 10

where AV C(q) = 10 and AF C(q) = 10


q

14

12

10

0 2 4 6 8 10 12 14 16 18 20
q

2) Total cost: T C(q) = 10 + q + q 2


dT C(q)
Marginal cost: M C(q) = dq = 1 + 2q
T C(q) 10+q+q 2
Average cost: AC(q) = q = q = 10
q +1+q

where AV C(q) = 1 + q and AF C(q) = 10


q

1
14

12

10

0 2 4 q6 8 10 12

3) Total cost: T C(q) = 10 + 10q − 4q 2 + q 3


Marginal cost: M C(q) = dTdqC(q)
= 10 − 8q + 3q 2
T C(q) 10+10q−4q 2 +q 3
Average cost: AC(q) = q = q = 10
q + 10 − 4q + q 2
where AV C(q) = 10 − 4q + q 2 and AF C(q) = 10
q

14

12

10

0 1 2 3 4 5
q

2
4) Total cost: T C(q) = 10 + 10q 2
dT C(q)
Marginal cost: M C(q) = dq = 20q
2
Average cost: AC(q) = T C(q)
q = 10+10q
q = 10
q + 10q
where AV C(q) = 10q and AF C(q) = 10 q

40

30

20

10

0 1 2 3 4 5
q

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