Quantity Total Marginal Produced Cost $270 $273 $277 $282 $288 $295 $303 $312 $3
ID: 1138601 • Letter: Q
Question
Quantity Total Marginal Produced Cost $270 $273 $277 $282 $288 $295 $303 $312 $322 $333 10 $345 $358 12$372 $387 $403 $420 $438 $457 Cost 2 9 13 1. 15 16 17 1. As you know from your reading for this chapter (specifically on page 35), marginal cost (or sometimes called opportunity cost) is the additional cost of producing one more unit of output. Fill in the marginal cost column of the table, showing the marginal cost of each of the individual widgets. 2. As more and more widgets are produced, does the marginal cost increase or does it decrease? [Hint: The answer to this question is not "yes" or "no".]Explanation / Answer
Answer
Q1
MC(n)=(TC(n)-TC(p))/(n-p)
MC(n)=marginal cost of an n-th unit
TC(n)=Total cost of n units of output
TC(p)=Total cost of p unit of output
here, n>p.
MC(1)=(273-270)/(1-0)=3
MC(2)=(277-273)/(2-1)=4
and so on
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Q2
Yes
The MC is increasing as it is increased 3,4,5 and so on for 1,2,3 and so on quantities
Q TC MC 0 270 1 273 3 2 277 4 3 282 5 4 288 6 5 295 7 6 303 8 7 312 9 8 322 10 9 333 11 10 345 12 11 358 13 12 372 14 13 387 15 14 403 16 15 420 17 16 438 18 17 457 19