Suppose the fixed cost to make coffee mugs is $200, and the marginal cost to make one
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Suppose the fixed cost to make coffee mugs is $200, and the marginal cost to make one mug is $0.85.
(a) Write a formula for the average cost function.
(b) As the number of mugs produced gets increasingly large, what does the average cost per mug approach?
(c) Sketch a graph of the average cost function.
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