The amount by 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.

Question

Quizplus · Accepted Answer

The amount by which total cost rises when the firm produces one additional unit of output is called marginal cost. Option A is incorrect because average cost is the total cost divided by the quantity of output produced. Option C is incorrect because fixed cost is the cost that remains constant as the level of output changes. Option D is incorrect because variable cost is the cost that varies with the level of output.

The Amount by Which Total Cost Rises When the Firm