Anderson Industries makes weatherproof covers for barbecue grills.Each cover costs $7.00 to produce and is sold to distributors for $15.The company's fixed costs are $170,000.The company's ________ for producing one more grill cover is $7.00 because its fixed costs per unit do not change.

Question

Quizplus · Accepted Answer

The concept described in the question is of marginal cost, which refers to the additional cost incurred in producing one more unit of a product. In this case, the cost of producing one more grill cover is $7, which is the same for every additional cover produced because the fixed costs remain constant. Therefore, the correct option is E, marginal cost.

Anderson Industries Makes Weatherproof Covers for Barbecue Grills