Given the total cost equation for a firm, the marginal cost equation can be derived by:
A) dividing total cost by total output.
B) taking the first derivative of the cost function with respect to quantity.
C) dividing total variable cost by total output.
D) subtracting variable cost from the fixed cost at all levels of output.
E) multiplying the total cost equation by price.

Question

Quizplus · Accepted Answer

Marginal cost is the change in total cost as a result of producing one more unit of output. Therefore, the derivative of the total cost function with respect to quantity gives the marginal cost function.

Given the Total Cost Equation for a Firm, the Marginal