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December 8th, 2012, 06:47 AM  #1 
Senior Member Joined: Sep 2012 Posts: 112 Thanks: 0  nature of cost curves
Q1. Given the following total cost functions, investigate the nature of average and marginal cost curves. i) C=0.0003Q^2+6.75Q10485 ii) C=0.8Q+3000 In case of (i), AC= 0.0003Q+6.7510485/Q. Here d(AC)/dQ>0 and d^2(AC)/dQ^2 <0. So this AC curve is rising upwards and is convex upwards. Again MC=0.0006Q+6.75. Here d(MC)/dQ>0 and d^2(MC)/dQ^2 =0. So this MC curve is rising upwards and is a straight line. Is correct to write the answer like this? What am I supposed to write in case of (ii)? 

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cost, curves, nature 
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