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Let the total cost function C(x) be defined as follows: C(x)=2500+2x−0

Accounting Dec 07, 2020

Let the total cost function C(x) be defined as follows:

C(x)=2500+2x−0.0005x2 (0≤x≤6000)C(x)=2500+2x−0.0005x2 (0≤x≤6000)

Find the average cost function.

Expert Solution

We have the total cost function as:

C(x)=2500+2x−0.0005x2C(x)=2500+2x−0.0005x2

The average cost function is equal to:

AC(x)=C(x)xAC(x)=2500+2x+0.0005x2xAC(x)=2500x+2+0.0005x

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