4. Assume a firm operating under a short run production period with a total cost function given

as Tc=200Q+5QTHE POWER 2+2QTHE POWER 3


4.1. What must be the output size to minimize the average cost of production, and show
if marginal cost of production is increasing or decreasing at this point (1.5pts)

1 answer

The output size to minimize the average cost of production is Q = 0. The marginal cost of production is decreasing at this point.