If c is the total cost in dollars to produce q units of a product, then the average cost per unit for an output, of q units is given by c (there's a line over the c) = c/q.
Thus if the total cost equation is c = 5000 + 6q, then
c(line over it) = (5000 / q) + 6
For example, the total cost of an output of 5 units is $5030, and the average cost per unit at that level of production is $1006. By finding the limit q-->inifinity c(line over it), show that the average cost approaches a level of stability if the producer continually increases output. What is the limiting value of the average cost?
therefore lim q-->inifnity = 5000/q + 6 = 0 + 6 = 6
Now for the real question:
Repeat the problem above, given that the fixed cost is $12,000 and the variable cost is given by the function cv= 7q
Sooo the way i see it:
C = 12000 + 7/q
therefore 12000/q + 7
= 0 + 7
= 7?