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Suppose a firm produces an output measured in units Q. The cost of producing Q units is given by the cost function C(Q) = aQ2 + bQ + c, where you can assume a > 0,b > 0,c > 0. In Economics we also think about cost per unit (average cost) given by: AC(Q) = C(Q).
EconomistsQ also estimate the cost of producing 1 more unit of output by what we call marginal cost given by: MC(Q) = C′(Q) . Use calculus to help you graph both the AC(Q) and MC(Q) functions in one diagram and show that theMC(Q) function intersects the AC(Q) function from below at the point where AC(Q) is at its minimum.
Please show step by step how the answer came and explain as this is practice for a mid term exam. This is Mathematical Economics which involves calculus. Thank you for your help.
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