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Question : "Marginal cost" equals:

Option 1: total cost minus total benefit for the last unit produced

Option 2: total cost divided by total benefit for the last unit produced

Option 3: total cost divided by quantity

Option 4: the change in total cost divided by the change in quantity


Team Careers360 24th Jan, 2024
Answer (1)
Team Careers360 25th Jan, 2024

Correct Answer: the change in total cost divided by the change in quantity


Solution : The correct answer is the change in total cost divided by the change in quantity .

The marginal cost is the difference in total production costs generated by developing or manufacturing one extra unit. To calculate the marginal cost, divide the change in production expenses by the change in quantity. The purpose of marginal cost analysis is to determine when a company may achieve economies of scale to optimise production and overall operations. If the marginal cost of producing one extra unit is less than the per-unit price, the producer may profit.

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