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I’m guessing what this means is that if $C$ is the cost function and $x$ represents the number of units of a good produced, marginal cost at production level $x_0$ is not the cost of producing the $(x …

If it’s a “market demand curve,” that means the quantity demanded is that of the entire market. If it’s an “individual demand curve,” it’s the quantity demanded of an individual consumer. If you open …

Others have provided intuitive explanations; I thought I’d provide a short mathematical one. Suppose a firm faces a production function $q = f(K,L)$. Assume $f_K, f_L > 0$ and $f_{KK}, f_{LL} < 0$. ( …

I’m currently learning intermediate microeconomics with calculus. … One is Microeconomics: Theory and Applications with Calculus by Jeffrey Perloff (not to be confused with his other textbook, Microeconomics) and the other is Intermediate Microeconomics with Calculus by …

I'm just gonna try doing it. The problem is: $$\text{min } C = rK + wL \\ \text{s.t. } q = K + \ln(L) $$ The implied constraint, of course, is $L \in [1, \infty)$ (non-negativity constraint, as $q > …

Let demand elasticity be $\varepsilon$. Then $$\varepsilon = (\frac{p}{D(p)})\frac{\mathrm{d}D(p)}{\mathrm{d}p} \ \ \text{(1)}$$ For a perfectly elastic demand curve, $\frac{\mathrm{d}D(p)}{\mathrm{ …

The demand curve is: $$p = 60 - 0.002q$$ Marginal cost ($C'(q)$) is a constant 10 dollars and fixed costs ($k$) are 300,000 dollars. Hence, $$C(q) = \int_{0}^{q} 10 \ \mathrm{d}x + k = 10q + k$$ …

Lots of people have good, comprehensive answers, but here’s a very short one: First, you’re assuming the firm is a price setter. In competitive markets, both producers and firms are price takers. Whe …