Marginal cost is the additional cost incurred in producing one more unit of output. It is often considered as the opportunity cost of producing one more unit of output, as in order to produce one more unit, resources have to be diverted from producing something else, leading to a foregone opportunity cost. Therefore, choice E is the best answer.

Solved

Marginal Cost Equals

Question 25

Multiple Choice

Marginal cost equals

A) all the opportunity cost of producing the amount of output.
B) productive efficiency.
C) the profitability derived from producing another unit of output.
D) or exceeds the marginal benefit.
E) the opportunity cost of producing one more unit of output.

Correct Answer: