find fixed cost average total cost and marginal cost Model 2

find fixed cost, average total cost, and marginal cost

Model 2: OLS, using observations 1-158 Dependent variable: cost p-value 0.3347 0.0001 0.0001 Coefficient Std. Error t-ratio 2.29906 0.9677 0.00434763 0.000230941 18.83 5.829 const 2.22486 SAA 1.63160e-08 2.79915e-09 S.D. dependent var Mean dependent var Sum squared resid R-squared F(2, 155) Log-likelihood Schwarz criterion 53.26996 63867.60 S.E. of regression 0.946328 Adjusted R-squared 1366.447 P-value(F) 87.05933 20.29899 0.945635 3.59e-99 1402.696 1406.427 -698.3481 Akaike criterion 1411.884 Hannan-Quinn

Solution

The corresponding equation is

Cost = 2.22486 + 0.00434763*q + (~0)q^2.

THus fixed cost is cost at q=0 => 2.22486

Average cost = E[cost] = 2.22486 + 0.00434763 ~ 2.228

marginal cost = beta(the coefficient of q)= 0.00434763