Posted by Kiersyn on Tuesday, February 9, 2010 at 8:01am.
A so-called cubic function is nothing else than a polynomial function of degree 3.
f(x)=ax^3+bx^2+cx+d, where a,b,c,d are fixed, but not determined constant coefficients, imposed the condition a != 0.
Wow, this definition is like greek. What is a polynomial function of degree 3? I know what a constant is and also a coefficent. But what is "imposed the condition a!=0? Can someone explain this in a simpler way that doesn't involve algebra or calculus? Thanks
Basically, the point of cubic is that you can use the cube (third power) of the number of things produced to predict the total cost of making that many things. It so happens that x^3 (x cubed) very nicely represents certain economies/not of scale in production; it "looks right".
So the whole point is that some algebra can provide a nice formula that approximates the reality of cost functions for which marginal cost (the cost of "making one more") first goes down, then goes up. And some calculus can confirm it.
Related Questions
managerial economics - Can someone break down the basic components of managerial...
managerial economics - EXPLAIN 5 FUNCTIONS OF MANAGERIAL ECONOMICS WITH SUITABLE...
MANAGERIAL ECONOMICS - EXPLAIN THE ROLE AND RESPONSIBILITY OF MANAGERIAL ...
managerial economoics - close relationship between mnagement and economics has ...
Managerial Economics - Managerial Economics uses_____to help solve problems. a. ...
managerial economics - Can someone explain cost structure and market structure ...
managerial economics - Can someone explain cost structure and market structure ...
MANAGERIAL ECONOMICS - SIGNIFICANCE OF MANAGERIAL ECONOMICS?
economics - 1. why is the subject of managerial economics relevant to problem of...
managerial economics - firms demand function,p=24-0.54q and the average cost ...
For Further Reading
