The Deering Manufacturing Company's short- run average cost function in 2012 was
AC = 3 + 4Q
where AC is the firm's average cost (in dollars per pound of the product), and Q is its output rate.
a. Obtain an equation for the firm's short- run total cost function.
b. Does the firm have any fixed costs? Explain.
c. If the price of the Deering Manufacturing Company's product (per pound) is $3, is the firm making profit or loss? Explain.
d. Derive an equation for the firm's marginal cost function.