Find out fixed cost, average variable cost and marginal cost from the given cost function TC=60+0.5q+0.3q2
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TC(q) = 60 + 0.5 q + 0.3 q²
TC (q -1) = 60 + 0.5 (q -1) + 0.3 (q - 1)²
= 59.8 - 0.1 q + 0.3 q²
Marginal cost : TC(q) - TC(q-1) = 0.6 q + 0.2
Fixed cost = 60 constant in TC
variable cost = VC(q) = 0.5 q + 0.3 q² : as this component varies depending on q.
Average variable cost = VC(q) / q = 0.5 + 0.3 q
TC (q -1) = 60 + 0.5 (q -1) + 0.3 (q - 1)²
= 59.8 - 0.1 q + 0.3 q²
Marginal cost : TC(q) - TC(q-1) = 0.6 q + 0.2
Fixed cost = 60 constant in TC
variable cost = VC(q) = 0.5 q + 0.3 q² : as this component varies depending on q.
Average variable cost = VC(q) / q = 0.5 + 0.3 q
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