Question

The change in total cost per unit of change in output is known as ............

• A. Average Cost
• B. Variable Cost
• C. Fixed Cost
• D. Short Run Marginal Cost

Hint:

MC is always about “extra cost for one more unit.” Use the slope of the Total Cost curve to calculate MC.

Answer 1

The Correct Option is D

Step 1: Recall the concept.
Marginal cost (MC) is defined as the change in total cost resulting from producing one more unit of output. \[ MC = \frac{\Delta TC}{\Delta Q} \] Step 2: Evaluate options.
- (A) Average cost = total cost ÷ quantity, not change.
- (B) Variable cost = cost of variable inputs, not change per unit.
- (C) Fixed cost = does not vary with output.
- (D) Short run marginal cost = correct definition, \(\Delta TC / \Delta Q\).
Final Answer: \[ \boxed{\text{Short Run Marginal Cost}} \]