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Cost function
1.
` Cost Analysis
and Estimation
2.
3.
4.
5.
6.
7.
Short Run Cost
Graphs AFC Q Q 1. 2. AVC 3. Q AFC AVC ATC MC MC intersects lowest point of AVC and lowest point of ATC. When MC < AVC, AVC declines When MC > AVC, AVC rises
8.
9.
10.
11.
12.
13.
14.
15.
Long Run Cost
Function (LAC) Envelope of SAC curves
16.
17.
Long-run Average Costs
18.
19.
20.
21.
22.
23.
24.
25.
Editor's Notes
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11
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13
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