Question: Let C(q) be the total cost of producing a quantity q of a certain product. See Figure.
(a) What is the meaning of C(0)?
(b) Describe in words how the marginal cost changes as the quantity produced increases.
(c) Explain the concavity of the graph (in terms of economics).
(d) Explain the economic significance (in terms of marginal cost) of the point at which the concavity changes.
(e) Do you expect the graph of C(q) to look like this for all types of products?
