Question
Suppose Honda's total cost of producing 4 cars is $225,000 and its total cost of producing 5 cars is $250,000
a)What is the average total cost of producing 5 cars
b)What is the marginal cost of the fifth car?
c)Draw the marginal cost curve and the average total cost curve for a typical firm,and explain why these curves cross where they do
a)What is the average total cost of producing 5 cars
b)What is the marginal cost of the fifth car?
c)Draw the marginal cost curve and the average total cost curve for a typical firm,and explain why these curves cross where they do
Answers
Average total cost of producing 5 cars is
ATC=Change in TC/ Change in Q
or Delta TC/ Delta Q
which is 250000/5
50000.
Marginal Cost for 5th car is
25000
ATC=Change in TC/ Change in Q
or Delta TC/ Delta Q
which is 250000/5
50000.
Marginal Cost for 5th car is
25000
I don't know but I need the graph of this question
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