Question

Given that the cost of a firm is C(q)=60q-12q^2+q^3. at what level of output is average cost minimum. and verify at the same level of output at which average cost is minimum average cost is equal to marginal cost

Answer 1

avg cost= C(q)/q
marginal cost = C'(q)

to minimize a function, set its derivative equal to 0
avg cost = A(q)= 60 -12q+q^2
A'(q) = 2q -12 = 0
--> q = 6