Asked by MIRTEMUR SHAKIROV on May 08, 2024
Verified
If the marginal cost of the first sports jersey is $21,the marginal cost of the second sports jersey is $40,and the marginal cost of the third jersey is $17,what is the total variable cost of producing three jerseys?
A) $26
B) $78
C) $17
D) $61
Total Variable Cost
The sum of expenses that vary directly with the level of production, such as raw materials and direct labor.
Marginal Cost
The expenditure involved in the production of one extra unit of a product.
- Differentiate between marginal cost and total variable cost, and calculate total variable cost.
Verified Answer
SK
Samriti KhuranaMay 15, 2024
Final Answer :
B
Explanation :
To find the total variable cost, we need to add up the marginal costs of each jersey.
Marginal cost of first jersey = $21
Marginal cost of second jersey = $40
Marginal cost of third jersey = $17
Total variable cost = Marginal cost of first jersey + Marginal cost of second jersey + Marginal cost of third jersey
Total variable cost = $21 + $40 + $17 = $78
Therefore, the correct answer is B.
Marginal cost of first jersey = $21
Marginal cost of second jersey = $40
Marginal cost of third jersey = $17
Total variable cost = Marginal cost of first jersey + Marginal cost of second jersey + Marginal cost of third jersey
Total variable cost = $21 + $40 + $17 = $78
Therefore, the correct answer is B.
Learning Objectives
- Differentiate between marginal cost and total variable cost, and calculate total variable cost.