Problem 4. The marginal cost C' for a product as a function of the number of unitsproduced q is shown in the graph below. The fixed costs are $5,000.marginal cost C' ($/unit)240200160120804010 20 30 40 50 60 quantity q (units)(a) Suppose you have already paid the fixed costs. Order the following quantities fromleast to greatest. Explain.(i) The average cost per unit to produce 60 units (in dollars).(ii) 200(iii) The cost to produce the first unit.(iv) The average cost per unit to produce 20 units (in dollars).(b) Estimate the average cost per unit to produce a total of 40 units, including the fixedcosts.

Fixed Cost = 5000MC is depicted in graph below ,

Answered: Problem 4. The marginal cost C" for a…

Problem 4. The marginal cost C" for a product as a function of the number of units produced q is shown in the graph below. The fixed costs are $5,000. marginal cost C" ($/unit) 240 200 160 120 80 40

Essentials of Economics (MindTap Course List)

8th Edition

ISBN:9781337091992

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter12: The Cost Of Production

Section: Chapter Questions

Problem 4CQQ

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Question

Problem 4. The marginal cost C' for a product as a function of the number of units
produced q is shown in the graph below. The fixed costs are $5,000.
marginal cost C' ($/unit)
240
200
160
120
80
40
10 20 30 40 50 60 quantity q (units)
(a) Suppose you have already paid the fixed costs. Order the following quantities from
least to greatest. Explain.
(i) The average cost per unit to produce 60 units (in dollars).
(ii) 200
(iii) The cost to produce the first unit.
(iv) The average cost per unit to produce 20 units (in dollars).
(b) Estimate the average cost per unit to produce a total of 40 units, including the fixed
costs.

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