which total cost rises when the firm produces one additional unit of output is called a. average cost. b. marginal cost. c. fixed cost. d. variable cost.

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06-12-2022
Business

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which total cost rises when the firm produces one additional unit of output is called a. average cost. b. marginal cost. c. fixed cost. d. variable cost.

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qwteddy qwteddy · Answer 1 · 2022-12-12T17:59:35+01:00

Option b. the marginal cost rises when the firm produces one additional unit of output

The term "marginal cost" describes the rise in manufacturing costs brought on by the creation of more product units. A different name for it is the marginal cost of production. Businesses may evaluate how the volume produced affects the cost and eventually profits by calculating the marginal cost.

Marginal Cost is calculated as Change in Total Cost / Change in Quantity, where a Change in Total Cost is calculated as the Total Cost of Production for a normal unit less the Total Cost of Production for an additional unit. Change in Quantity is calculated as Total Quantity Product minus Total Quantity Product of Additional Unit.

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