Question

Refer to Scenario 14-4. When the firm increases its output from 150 units to 151 units, its marginal cost is

Answer 1

Answer: $32.05

Explanation:

Marginal Cost is the Cost of producing one extra unit.

The total cost of producing 150 units is;

Total = Units * average cost

= 150 * 24.50

= $3,675

Total cost of producing 151 units

= 151 * 24.55

= $3,707.05‬

Difference = 3,707.05‬ - 3,675

= $32.05