Table 15-7
Sally owns the only shoe store in town. She has the following cost and revenue information.
-Refer to Table 15-7. What is the marginal cost of the 8th pair of shoes?
A)$50
B)$60
C)$90
D)$110

Question

Table 15-7
Sally owns the only shoe store in town. She has the following cost and revenue information. 
-Refer to Table 15-7. What is the marginal cost of the 8th pair of shoes?
A)$50 
B)$60 
C)$90 
D)$110

Quizplus · Accepted Answer

The marginal cost of the 8th pair of shoes is $90, which is calculated as the difference between the total cost of producing 8 pairs and 7 pairs of shoes ($750 - $660 = $90). Since the marginal revenue of the 8th pair is $100 and the marginal cost is $90, producing the 8th pair will result in a positive marginal benefit ($10). Therefore, it is the best choice for Sally to produce the 8th pair of shoes.

Table 15-7 Sally Owns the Only Shoe Store in Town. She Has