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Building the Supply Curve

is the additi...

Question

_______ is the addition made to the total cost by production of an additional unit of output.

A

Average cost

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B

Fixed cost

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C

Variable cost

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D

Marginal cost

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Solution

The correct option is B Marginal cost
Marginal cost is defined as the the cost incurred by producing one more unit. It is profitable to continue production if MC ≤ MR as this adds to total revenue.

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