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EconomicsMarginal cost Suppose that the dollar cost of
Chapter 3, Problem 23E(choose chapter or problem)
Problem 23E
Economics
Marginal cost Suppose that the dollar cost of producing x washing machines is
a. Find the average cost per machine of producing the first 100 washing machines.
b. Find the marginal cost when 100 washing machines are produced.
c. Show that the marginal cost when 100 washing machines are produced is approximately the cost of producing one more washing machine after the first 100 have been made, by calculating the latter cost directly.
Questions & Answers
QUESTION:
Problem 23E
Economics
Marginal cost Suppose that the dollar cost of producing x washing machines is
a. Find the average cost per machine of producing the first 100 washing machines.
b. Find the marginal cost when 100 washing machines are produced.
c. Show that the marginal cost when 100 washing machines are produced is approximately the cost of producing one more washing machine after the first 100 have been made, by calculating the latter cost directly.
ANSWER:
Solution :
Step 1 :
In this problem, we have to find the average cost per machine and marginal cost and show that the cost of producing one more machine is approximately equal to the marginal cost.