Blog 4

Stacey Schwartz


Blog #4
Good evening class, my name is Professor Schwartz and tonight we're going to be learning about average cost.
Average cost is the cost per unit of producing a certain quantity.
Before we learn the actual formula for average cost it's important to know what the cost function is. The cost function, c(q), is the function to figure out how much it would cost to produce a certain quantity, q.
The formula for finding the average cost is a(q) = c(q) / q
Here's an example:
The cost of producing dresses is represented by the function below:
c(q) = 0.01q^3 - 0.6q^2 + 13q

to find out how much the average cost would be to produce 100 dresses we would put first put 100 in for q:
C(100)=.01(100)^3-.6(100)^2+13(100)+1000= $6300

so that means that the c(q) part of the average cost formula would be (6300) and the q part would be 100

to put it all together, the average cost for producing 100 dresses is represented below:

a(q) = 6300/100 

so $63 per dress