Materials from Class - 2021-9 > Mon 12/6

Daily exercise on cost functions

A producer has a total cost function given by `TC(Q)=400+4Q^2`.

  1. Please compute the producer's total cost, average cost, and marginal cost for the values of Q in the table below. Round average costs to cents and skip the boxes with dashes.
Q TC(Q) AC(Q) MC(Q)
3
     ---
4
      
5      
--- --- --- ---
9     ---
10      
11      
--- --- --- ---
16     ---
17      
18      
  1. In which range does the cost function have approximately constant returns to scale? Where does it have increasing returns? Decreasing returns?

Please scan and upload your answer.

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Peter J Wilcoxen, The Maxwell School, Syracuse University
 Revised 12/06/2021