Differentiation, Curve Sketching, and Cost Functions (UMAP)

The purpose of this module is for students to: 1) understand the way in which continuous functions are used to approximate discrete functions in economics; 2) understand the analysis of the costs of production for a firm using calculus techniques; 3) understand when profits are maximized, using calculus techniques; and 4) review the techniques of curve sketching and finding extreme points.

Table of Contents:

1. INTRODUCTION
1.1 Approximation
1.2 Marginal Quantities

2. COSTS OF PRODUCTION
2.1 Total, Average, and Marginal Costs
2.2 The Economic Assumptions
2.3 Applying the Calculus
2.4 An Example

3. PROPERTIES OF AVERAGE AND MARGINAL COST
3.1 The U-Shaped Marginal Cost Curves
3.2 The Average Cost Curves

4. REVENUE AND PROFIT
4.1 Demand
4.2 Revenue and Marginal Revenue
4.3 Profit
4.4 An Example

5. PROBLEMS

6. MODEL EXAM

7. SOLUTIONS TO PROBLEMS