If $C(x)=x^2+5x+36$ is the total cost function for producing x units. The outputs for which average cost increases are :
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → (6, ∞)
The average cost (AC) is,
$AC=\frac{C(x)}{x}=\frac{x^2+5x+36}{x}$
$=x+5+\frac{36}{x}$
$AC'(x)=1-\frac{36}{x^2}=0$
$⇒x=6$
⇒ Average cost increases for $x>6$.