Plot short -run average and marginal cost functions

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A firm, when the capital is fixed at K in the short run, the labor demand is given by L(Q) = Q2/K, and the short-run cost is given by STC(Q; K ) = Q2/K + 100 K

Compute and plot short -run average and marginal cost functions. Find the capital demand K and labor demand L of the firm in the long-run.

Compute its long-run cost function TC(Q). Show the relationship between short-run and long-run total cost curves by drawing STC(Q; K ) and TC(Q) on the same graph.

Reference no: EM131808051

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