Figure and Table: Variable, Fixed, and Total Costs
(Figure and Table: Variable, Fixed, and Total Costs) Look at the figure and table Variable, Fixed, and Total Costs.In the figure, the marginal cost when increasing production from 19 to 36 bushels of wheat is:
A)$23.53.
B)$11.76.
C)$22.22.
D)$11.11.

Question

Quizplus · Accepted Answer

The marginal cost is the cost of producing one additional unit of output. From the table, when increasing production from 19 to 36 bushels, the variable cost goes from $225 to $420, which is an increase of $195. The marginal cost is then calculated by dividing the increase in variable cost by the increase in output: $195 / 17 bushels = $11.76/bushel. Therefore, the answer is B.