Sia
Question
Microeconomics
Posted 9 months ago
Which of the following best describes marginal cost?
Choose 1 answer:
(A) The cost of producing a typical unit of output
(B) The costs that do not vary as output changes, per unit of output
(C) The costs that do not vary as output changes
(D) The costs that vary as output changes, per unit of output
(E) The cost of producing one more unit of output
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Answer from Sia
Posted 9 months ago
Solution
a
Definition of Marginal Cost: Marginal cost is the additional cost incurred by producing one more unit of output
b
Correct Option: The correct option is (E) The cost of producing one more unit of output
Answer
(E) The cost of producing one more unit of output
Key Concept
Marginal Cost
Explanation
Marginal cost represents the change in total cost that arises when the quantity produced changes by one unit. It is crucial for decision-making in production as it helps firms determine the optimal level of output.
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