Asked by Bianca Benincasa on Jul 09, 2024
Verified
The cost of producing an additional unit of a good is not the same as the average cost of the good.
Average Cost
The total cost divided by the number of goods produced, also known as cost per unit.
Marginal Cost
The change in total cost that results from producing one additional unit of a good or service, a key concept in economic decision-making and pricing strategies.
- Comprehend the aspects of cost variation, such as variable, fixed, and marginal costs, and their relationship to the measure of production output.
Verified Answer
YB
Yahya Balc?Jul 10, 2024
Final Answer :
True
Explanation :
The cost of producing an additional unit of a good is referred to as the marginal cost, which can vary and is not necessarily the same as the average cost of producing the good. The average cost takes into account the total cost of production divided by the number of goods produced, while the marginal cost focuses on the cost of producing one more unit.
Learning Objectives
- Comprehend the aspects of cost variation, such as variable, fixed, and marginal costs, and their relationship to the measure of production output.