Asked by Dylan Gauthier on Jul 12, 2024
Verified
Marginal cost is the:
A) increase in total cost when one more unit of output is produced.
B) reduction in cost from economies of scale.
C) ratio of average total cost to total cost.
D) increase in output from the addition of one unit of labor.
Marginal Cost
The outlay for creating another unit of a product or service.
Economies of Scale
Cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale.
Output
The total amount of goods or services produced by a company, industry, or economy within a specific period.
- Identify and explain the presence of diminishing returns and its impact on cost curves.
- Scrutinize and decode the intricacies of cost curves, incorporating total cost, marginal cost, and average cost curves.
Verified Answer
AB
Adrian BravoJul 14, 2024
Final Answer :
A
Explanation :
Marginal cost is the increase in total cost that results from producing one additional unit of output. It is the cost of producing one more unit of a good or service.
Learning Objectives
- Identify and explain the presence of diminishing returns and its impact on cost curves.
- Scrutinize and decode the intricacies of cost curves, incorporating total cost, marginal cost, and average cost curves.
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