Unpublished Paper
lumpyCost II
(2020)
Abstract
A lumpy cost function is a step-wise increasing but not a continuous function of output. It is an accurate description of cost conditions in many industries especially air travel, generating electric power, auto manufacturing and software. This essay has diagrams illustrating the problem and solutions.
JEL C6 Mathematical Methods, C61 Optimization Techniques, D24 Cost
Keywords
- avoidable cost,
- variable cost,
- fixed cost
Disciplines
Publication Date
January 17, 2020
Citation Information
Core Models, Cooperative Game Theory