Consider the following cost function Find the average cost a

Consider the following cost function. Find the average cost and marginal cost functions. Determine the average and marginal cost when x = Interpret the values obtained in part (b). C(x) = 0.03x3 + 0.8x2 + 40x + 100. a = 1000

Solution

average cost is total cost divided by the output

AC(x)=C(x)/x = (.03x^3+.8x^2+40x+100)/x = .03x²+.8x+40+100/x

Marginal cost is the derivative of the cost function
=.09x² + .16x +40

b. you plug in 1000 for x
average cost 30,840
marginal cost 90,200