Marginal cost is the
A)change in average cost when an additional unit of output is produced.
B)additional output when total cost is increased by one dollar.
C)additional cost of producing an additional unit of output.
D)change in the price of inputs if a firm buys more inputs to produce an additional unit of output.

Question

Quizplus · Accepted Answer

Marginal cost is the additional cost of producing an additional unit of output. It represents the cost of the last unit produced and is calculated by dividing the change in total cost by the change in output. Option A is incorrect because it refers to the change in average cost, which is different from marginal cost. Option B is incorrect because it does not relate to the cost of production. Option D is incorrect because it refers to the change in price of inputs, which is not the same as marginal cost.

Marginal Cost Is the