Suppose the cost of 5 pencils is $1.50. The cost of 6 pencils is $1.75. The marginal cost of the sixth pencil is

Question

Quizplus · Accepted Answer

To calculate the marginal cost of the sixth pencil, we need to determine the additional cost of purchasing one more pencil beyond the first five.

We know that 5 pencils cost $1.50, which means that each pencil costs $0.30 (1.50/5).

To find the marginal cost of the sixth pencil, we need to subtract the cost of the first five pencils from the cost of the first six pencils:

$1.75 - $1.50 = $0.25

Therefore, the marginal cost of the sixth pencil is $0.25, which corresponds to choice B.

Suppose the Cost of 5 Pencils Is $1