The marginal cost and total cost of an activity are, respectively:
A) the opportunity cost of the activity, and the opportunity cost plus the financial cost of the activity.
B) the change in total cost from an additional unit of the activity, and the cost of a specified number of units of the activity.
C) the average cost of a specified number of units of the activity, and the value of all of the average costs of the activity added together.
D) none of the above.

Question

Quizplus · Accepted Answer

Marginal cost refers to the change in total cost that arises when the quantity produced is incremented by one unit. Total cost is the aggregate expenditure incurred in producing a given quantity of output, encompassing both fixed and variable costs.

The Marginal Cost and Total Cost of an Activity Are