In the previous Problem Set question, we started looking at the cost function C (æ), the cost of a firm producing a items. An important microeconomics concept is the marginal cost, defined in (non- mathematical introductory) economics as the cost of producing one additional item. If the current production level is z items with cost C (æ), then the cost of computing h additionial (C(z+h)-C(x)) . As we analyze the items is C ( + h). The average cost of those h items is cost of just the last item produced, this can be made into a mathematical model by taking the limit as h → 0, i.e. the derivative C' (x). Use this function in the model below for the Marginal Cost function MC (z). Problem Set question: The cost, in dollars, of producing a units of a certain item is given by C(z) = 0.02m3 – 10z + 450. (a) Find the marginal cost function. MC (x) - 固助 (b) Find the marginal cost when 50 units of item are produced. The marginal cost when 50 units are produced is $ Number (c) Find the actual cost of increasing production from 50 units to 51 units. The actual cost of increasing production from 50 units to 51 units is $ Number
In the previous Problem Set question, we started looking at the cost function C (æ), the cost of a firm producing a items. An important microeconomics concept is the marginal cost, defined in (non- mathematical introductory) economics as the cost of producing one additional item. If the current production level is z items with cost C (æ), then the cost of computing h additionial (C(z+h)-C(x)) . As we analyze the items is C ( + h). The average cost of those h items is cost of just the last item produced, this can be made into a mathematical model by taking the limit as h → 0, i.e. the derivative C' (x). Use this function in the model below for the Marginal Cost function MC (z). Problem Set question: The cost, in dollars, of producing a units of a certain item is given by C(z) = 0.02m3 – 10z + 450. (a) Find the marginal cost function. MC (x) - 固助 (b) Find the marginal cost when 50 units of item are produced. The marginal cost when 50 units are produced is $ Number (c) Find the actual cost of increasing production from 50 units to 51 units. The actual cost of increasing production from 50 units to 51 units is $ Number
Chapter22: Supply: The Costs Of Doing Business
Section: Chapter Questions
Problem 14E
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Transcribed Image Text:Introduction to Calculus in Economics (continued):
In the previous Problem Set question, we started looking at the cost function C (æ), the cost of a firm
producing z items. An important microeconomics concept is the marginal cost, defined in (non-
mathematical introductory) economics as the cost of producing one additional item.
If the current production level is æ items with cost C (z), then the cost of computing h additionial
(C(z+h)-C(z))
items is C (z + h). The average cost of those h items is
. As we analyze the
cost of just the last item produced, this can be made into a mathematical model by taking the limit
as h → 0, i.e. the derivative C' (z). Use this function in the model below for the Marginal Cost
function MC (x).
Problem Set question:
The cost, in dollars, of producing z units of a certain item is given by
C (z) = 0.02a3 – 10z + 450.
(a) Find the marginal cost function.
MC (z)
(b) Find the marginal cost when 50 units of the item are produced.
The marginal cost when 50 units are produced is $ Number
(c) Find the actual cost of increasing production from 50 units to 51 units.
The actual cost of increasing production from 50 units to 51 units is $ Number
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