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    talal-crackdown's Avatar
    talal-crackdown Posts: 34, Reputation: 1
    Junior Member
     
    #1

    Jun 9, 2009, 05:10 AM
    What is a linear cost function?
    Help me
    I don't know what is a cost function and how it is formulated?
    Can anyone tell me the basics of this function and method of formulating?
    I will highly appriciate...
    JimGunther's Avatar
    JimGunther Posts: 436, Reputation: 38
    Full Member
     
    #2

    Jun 9, 2009, 09:12 AM

    Check this site out, you need MS word or something equivalent and when the document is loaded, search for the word "cost"


    http://www.math.tamu.edu/AppliedCalc...k/Chapter1.doc
    ArcSine's Avatar
    ArcSine Posts: 969, Reputation: 106
    Senior Member
     
    #3

    Jun 9, 2009, 12:35 PM
    Work through the info provided at Mr. Gunther's link--it'll give you a fuller picture of linear functions in general, and how they work to model production costs, in the right situation.

    If you're familiar with the general linear function

    y = f(x) = mx + b

    ... then using this as a way of modeling your production costs, the Cast of Characters goes like this:

    y represents your total costs, which are a result of your fixed costs + the variable costs;
    m is the variable cost per unit produced;
    x is the number of units produced; and
    b represents your fixed costs.

    You might be pleasantly surprised to find out that this is just a way of using symbols to say what you already know. If I said that fixed costs were $1,000 (no matter how many units I make), and also that my variable costs were 75 cents per unit produced, and I asked you how much it would cost me to make 100 units, you'd reason...

    "75 cents times 100 units = $75, plus $1,000 fixed costs; OK it'd cost you $1,075 to make 100 units." Well, you just did y = mx + b in your head.

    Best of luck!

    ...it was early and I was full of no coffee...
    talal-crackdown's Avatar
    talal-crackdown Posts: 34, Reputation: 1
    Junior Member
     
    #4

    Jun 20, 2009, 04:02 AM
    Sir I am extremely thankfull to you because I was striving for basic concepts.. and I hope that your text will help me in modifying my concpets... again thanks very much
    GOD bless you
    talal-crackdown's Avatar
    talal-crackdown Posts: 34, Reputation: 1
    Junior Member
     
    #5

    Jun 20, 2009, 04:04 AM
    Thakyou brother for your kind help
    I appriciate
    ArcSine's Avatar
    ArcSine Posts: 969, Reputation: 106
    Senior Member
     
    #6

    Jun 20, 2009, 04:20 AM
    Always a pleasure.

    ...it was early and I was full of no coffee...
    priyam0137's Avatar
    priyam0137 Posts: 1, Reputation: 1
    New Member
     
    #7

    Dec 10, 2009, 05:34 PM
    hi there,

    if it was a polynomial fuction such as, y= mx^2 - nx + b, what would be the variable cost in this case?
    quilla1000's Avatar
    quilla1000 Posts: 1, Reputation: 1
    New Member
     
    #8

    Jun 8, 2010, 09:01 PM
    Fixed cost =b
    Variable cost = (mx^2 - nx ) or (mx - n)x

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