If the monthly total cost of production 27-inch television sets is given by C (x

Question

If the monthly total cost of production 27-inch television sets is given by C (x) = 40,000 + 108x, where x is the number of sets produced per month, then the average cost per unit is given by the following equation. C (x) = 40,000 + 108x/x Explain how C (x) and another function can be combined to obtain the average cost function. What is the average cost per set if 7000 sets are produced? Choose the correct answer below. C (x) is obtained by diving C (x) = 40,000 + 108 x by the identity function, I (x) = x. C (x) is obtained by dividing the identity function I (x) = x by C (x) = 40,000 + 108 x C (x) is obtained by multiplying C (x) = 40,000 + 108 x by the identity function, I (x) = x. The average cost per set, if 7000 sets are produced, is approximately $. (Do not include the $ symbol in your answer. Type an integers or a decimal rounded to two decimal places as needed.)

Explanation / Answer

a) C(x) = 40000 + 108x

Let's assume another function f(x) = 1/x

So, if C(x) * f(x) is done it gives average cost function = (40000 + 108x) * 1/x

b) When x = 7000

Average cost = (40000 + 108x) * 1/x

Average cost = (40000 + 108*7000) * 1/7000

Average cost = 113.71

c) A option

C bar x is obtained by dividing C(x) by l(x) = x

d) Average cost = 113.71

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