Consider the following demand and cost information ?

$\begin{array}{|c|c|c|}
\hline \underline{\text { Quantity }} & \underline{\text { Price }} & \underline{\text { Total Cost }} \
\hline 0 & € 40 & € 10 \
\hline 1 & € 30 & € 15 \
\hline 2 & € 20 & € 25 \
\hline 3 & € 10 & € 40 \
\hline 4 & € 0 & € 60 \
\hline
\end{array}$
Refer to the table above. The marginal cost of the fourth unit
?
A) €60
B) €40
C) €20
D) €10

Question

Consider the following demand and cost information ?

$\begin{array}{|c|c|c|}
\hline \underline{\text { Quantity }} & \underline{\text { Price }} & \underline{\text { Total Cost }} \
\hline 0 & € 40 & € 10 \
\hline 1 & € 30 & € 15 \
\hline 2 & € 20 & € 25 \
\hline 3 & € 10 & € 40 \
\hline 4 & € 0 & € 60 \
\hline
\end{array}$
Refer to the table above. The marginal cost of the fourth unit
?
A) €60
B) €40
C) €20
D) €10

Quizplus · Accepted Answer

The marginal cost is the change in total cost when one additional unit is produced. In this case, the total cost increases from €40 to €60 when the quantity increases from 3 to 4. Therefore, the marginal cost of the fourth unit is €20.

Consider the Following Demand and Cost Information Refer to the Table Above