The marginal cost of producing the 100th unit of output is $200.
A firm has a fixed cost of $700 in its first year of operation. When the firm produces 99 units of output, its total costs are $4,000.
The term "marginal cost" describes the rise in manufacturing costs brought on by the creation of more product units. A different name for it is the marginal cost of production. Businesses may evaluate how volume produced affects cost and eventually profits by calculating the marginal cost.
Marginal cost = (Change in cost) / (Change in quantity)
The volume of output either increases or decreases, which affects quantity. With an increase or decrease in production, there will be a variation in cost. The page on the marginal cost formula, which is significant in production, is now complete.
The marginal cost of producing the 100th unit of output is $200.
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