Answer Happy

The cost of producing x teddy bears per day
at the Cuddly Companion Co. is calculated by their marketing staff
to be given by the formula
C(x) = 100 + 40x − 0.02x2.
(a)
Find the marginal cost
function C'(x).
C'(x) =
Use it to determine how fast the cost is going up (in $) at a
production level of 100 teddy bears.
$ per teddy bear
Compare this with the exact cost of producing the
101st teddy bear (in $).
The cost is increasing at a rate of $ per teddy bear.
The exact cost of producing the 101st teddy bear
is $ . Thus, there is a difference of
$ .
(b)
Find the average cost function
C,
and evaluate
C(100)
(in $).
C(x)
=
C(100)
= $ per teddy bear
What does the answer tell you?
The average cost of producing the first hundred teddy bears is
$ per teddy bear.