Marginal cost- i've never done these types of problems before and very confused

In summary, the cost function for producing x washing machines is c(x) = 2000 + 100x - 0.1x^2. To find the average cost of producing 100 washing machines, we divide the total cost (c(100)) by the number of machines produced (100). To find the marginal cost when 100 washing machines are produced, we use the linearization c'(100) to calculate the additional cost for one more machine.
  • #1
jtt
16
0

Homework Statement


suppose that the dollar cost of producing x washing machines is c(x)= 2000 + 100x-0.1x6^2

a) find the average cost of producing 100 washing machines.
b) find the marginal cost when 100 washing machines are produced.

Homework Equations


c(x)= 2000 + 100x-0.1x6^2: the only equation given



The Attempt at a Solution


i've tried taking the derivative and then substituting it with 100. for part a and for part b i didnt take the derivative, just plugged in 100 into the equation given
 
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  • #2
Could you clarify that cost function expression? Is it [itex]c(x) = 2000 + 100x - 0.1x^{2}[/itex]?

The total cost to produce 100 washing machines is c(100) . The average cost is the cost per machine, which is [itex]\frac{ c(100) }{100} . [/itex]

The marginal cost, on the other hand, is the linearization for finding the amount of additional cost it would take to produce one more machine, given that 100 have already been built. This linearization is [itex] c'(100) \cdot ( 101 - 100 ) [/itex] , or just c'(100) .
 
  • #3
yes the cost function expression is c(x)= 2000 + 100x-0.1x^2
 
  • #4
Well, the definitions I've given are all you need. You started doing some calculations along those lines, but I think you had some of what you needed to do swapped relative to which part it goes with.
 
  • #5
thanks for the help on this
 

1. What exactly is marginal cost?

Marginal cost is the additional cost incurred per unit when producing one more unit of a good or service. It takes into account the changes in total cost and total quantity produced.

2. How is marginal cost calculated?

Marginal cost can be calculated by taking the change in total cost and dividing it by the change in quantity produced. This can be represented as MC = ΔTC / ΔQ.

3. What is the significance of marginal cost in economics?

Marginal cost is an important concept in economics as it helps businesses determine the most efficient level of production to maximize profits. It also plays a role in setting prices and understanding supply and demand.

4. Can marginal cost ever be negative?

Yes, marginal cost can be negative in certain cases. This occurs when there is a decrease in total cost with an increase in quantity produced. It is common in industries with high fixed costs, such as technology or pharmaceuticals.

5. How does marginal cost differ from average cost?

While marginal cost looks at the cost of producing one additional unit, average cost takes into account the total cost divided by the total quantity produced. Average cost is influenced by fixed costs, while marginal cost is only affected by variable costs.

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