Question

Suppose the cost function for a product is linear and the marginal cost is $5. If the profit is $200 when 125 units are sold,a) write the equation of the cost function. b) Explain the marginal cost. 

          Suppose the cost function for a product is linear and the marginal cost is $5. If the profit is $200 when 125 units are sold,a) write the equation of the cost function. b) Explain the marginal cost.

Added by Patrick C.

Calculus: Early Transcendentals
Calculus: Early Transcendentals
James Stewart 8th Edition
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Suppose the cost function for a product is linear and the marginal cost is $5. If the profit is $200 when 125 units are sold,a) write the equation of the cost function. b) Explain the marginal cost.
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Transcript

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00:01 Hello everyone in this problem we are given that the marginal cost as marginal cost as $5 and it is given that the profit is $200 when 125 units are sold so we need to write the equation of the equation in the first part of the equation so for that we are given with the marginal cost let us take this marginal cost as the slope of the line representing the profit function so m will be 5 and at the point it is given as 125 200 so in the point slope formula which is p minus p1 which is equal to m into x minus x1 so substituting the values here so it will be p minus 200 which is equal to m as 5 and x minus x x one is 125.
01:10 So simplifying this we get the equation of p to be equal to 5x minus 425.
01:17 So this is the acquired equation of the cost function.
01:25 Now in the next subpart of the equation we need to explain marginal cost.
01:36 So marginal cost is the marginal cost of production is the change in, change in total production cost total production cost that comes from making or producing one additional unit...
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